Headed into PhIII, Lundbeck scores $825M Alzheimer's drug pact with Otsuka

Lundbeck has scored an $825 million collaboration deal with Otsuka Pharmaceuticals for one of its showcase drug development programs. Building on an earlier alliance, Otsuka has gained co-development and co-promotion rights in the U.S., Japan and Europe for Lu AE58054, an experimental Alzheimer's drug now in position for a looming pivotal program.

Lundbeck gets $150 million of the collaboration money upfront, with the remainder promised for a range of regulatory and sales milestones. Otsuka will also share expenses going forward as the drug--an 5-HT6-receptor antagonist--preps for several Phase III studies with more than 2,500 patients. Those studies are slated to begin later this year. Investigators will look to see if the treatment combined with donepezil can improve cognition in mild-to-moderate patients. 

The big idea here is that targeting the 5-HT6 receptor should spur the release of chemicals that improve cognition in patients. A number of high-profile efforts aimed at targeting the root cause of Alzheimer's--which is still not well understood--have foundered in Phase III in recent years. But with an estimated third of U.S. seniors dying with the disease, their memories wiped out, the payoff for even a modest but significant effect on patients' symptoms would capture an enormous market.

Lundbeck CEO Ulf Wiinberg hit that note with reporters today, telling them that an approval would be worth more than $1 billion a year in the U.S., according to Reuters. Lundbeck needs a win badly. This program was designated as one of its top three late-stage efforts recently, its revenue sliding following the loss of patent protection for Lexapro. And they may get some help from the FDA, which recently has been encouraging developers to focus on new therapies, offering to lower the regulatory bar in order to gain some badly needed approvals.

"The global collaboration between Otsuka and Lundbeck continues to grow stronger with the addition of Lu AE58054," said Otsuka President Taro Iwamoto. "Not only does the product further enhance the synergy between the companies as we work together to bring to the market solutions for better health, Lu AE58054 is a potentially promising development in a very difficult disease area." 

- here's the press release
- read the Reuters story

Special Reports: The Top Phase III Disasters of 2012 | The Alzheimer's pipeline: What's next?

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