Seeking an edge in a fiercely fought field, Bristol-Myers pays Halozyme $105M to access I-O delivery tech

Bristol-Myers Squibb has paid Halozyme $105 million upfront to access drug delivery technology. The agreement positions Bristol-Myers to develop subcutaneous formulations of molecules against PD-1 and 10 other immuno-oncology targets.

Accessing Halozyme’s Enhanze technology gives Bristol-Myers a way to differentiate its PD-1 drug and other immuno-oncology products from competitors in the increasingly congested field. If the project advances as Bristol-Myers hopes, its immuno-oncology drugs will be delivered quickly and subcutaneously, not via the intravenous infusions that are performed today. Intravenous infusions of Bristol-Myers’ PD-1 drug Opdivo take about one hour.

Bristol-Myers is committing a sizable sum of money for the chance to shorten this time. Halozyme is in line to receive up to $160 million in milestones for each target pursued by Bristol-Myers. PD-1 is one of multiple targets already selected by Bristol-Myers. The number could grow to 11 over the next five years. Total success against all targets, a very unlikely outcome, would see Bristol-Myers pay close to $1.8 billion in milestones, with more to follow if combination plays worked out.

For now, Bristol-Myers has spent $105 million to access the Enhanze technology. But it sees the project and its outlay on it scaling up to the point it knocks $0.05 off its earnings per share in 2019.

In return, Bristol-Myers can develop drugs powered by Enhanze, a drug delivery technology based on a proprietary recombinant human hyaluronidase enzyme, rHuPH20. This enzyme temporarily breaks down hyaluronan, a natural sugar chain that forms a gel in the subcutaneous layer. In its gel form, hyaluronan contributes to resistance to bulk fluid flow in the subcutaneous space, which, in turn, limits the volume of drugs that can be administered quickly into this part of the body.

By breaking down hyaluronan, rHuPH20 releases water from the gel, increasing bulk fluid flow. When combined with a drug, the enzyme increases the dispersion and absorption of the molecule. 

Halozyme has landed deals with AbbVie, Eli Lilly, Johnson & Johnson, Pfizer and Roche on the strength of rHuPH20’s ability to unlock subcutaneous delivery. Bristol-Myers, recognizing that some of its immuno-oncology drugs may struggle to stand out on efficacy alone, has now joined this list. 

“Through our work with Halozyme, we hope to improve the patient treatment experience by developing flexible and convenient treatment delivery options,” Murdo Gordon, chief commercial officer at Bristol-Myers, said in a statement