|Shire CEO Flemming Ornskov|
Shire CEO Flemming Ornskov is spending $300 million of his cache of cash on a new ophthalmology buyout. Ornskov has pulled the trigger on a deal to snap up Foresight Biotherapeutics, adding a new bolt-on group with plans to take an eye drug into Phase III.
The main prize in the deal is FST-100, which Ornskov believes can provide a comprehensive therapy for infectious conjunctivitis, better known as pink eye. The drug fell short of the goal line in a Phase II. "While the two-arm study showed a trend toward efficacy, there were too few subjects testing positive for a viral presence for the study to deliver meaningful results, and it was not statistically significant," according to Shire ($SHPG).
Ornskov has been an avid buyer of ophthalmology drugs, despite a mixed record in the field. Lifitegrast--acquired in the SARcode buyout--achieved mixed results in a Phase III dry-eye study and is now under FDA review, despite some doubts about its ability to deliver. Shire also recently reported that its liver disease program for SHP625--acquired in the Lumena buyout--failed a mid-stage study in the spring.
Ornskov handed over the news of the deal in advance to The Wall Street Journal, a common PR strategy. In a preview of the deal, he highlighted FST-100's chances of addressing both the viral and bacterial causes of pink eye, though he's basing part of that plan on just preclinical evidence of efficacy for the bacterial form of the disease. And he touted the opportunity to add a new drug to the pipeline that he ultimately plans to market to the same set of doctors as lifitegrast.
"This product will bring a total new horizon of treatment for conjunctivitis. It is a true breakthrough," Ornskov boasted to the Journal.
Investors didn't share in the enthusiasm, though, with Shire's shares up only slightly in morning trading Monday.
Ever since AbbVie ($ABBV) wandered away from the deal table last year after getting cold feet on a buyout deal with Shire, the biotech has been pumping up its staffers and analysts with talk of an aggressive M&A strategy. Ornskov promised analysts that he plans to double annual sales to $10 billion by 2020, and these new drugs in the pipeline will have to pay off with blockbuster revenue in order to achieve that goal. In the meantime Shire has been reorganizing around its Lexington, MA, campus, a move that has cost 600 jobs in Pennsylvania.
Ornskov has been trying to build a franchise in ophthalmology since taking the reins of the company three years ago. His resume includes a stint in Novartis' ($NVS) eye drug group, followed by work at Bausch + Lomb.
"FST-100 and lifitegrast, if approved, would address two of the leading reasons people seek eye care treatment," Ornskov noted.
- here's the release