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Alexion eyes Soliris combo with $930m deal to buy Achillion

Additional shares will be tied to various milestones

Alexion

Alexion has added to its rare blood disorder pipeline with a $930m agreement to buy smaller biotech Achillion Pharma.

The $6.30-per-share offer is a 73% premium on Achillion’s closing share price ahead of the announcement and – if it goes through – will add two experimental treatments for paroxysmal nocturnal haemoglobinuria (PNH), a rare disease whose treatment is currently dominated by Alexion’s blockbuster complement C5 inhibitor Soliris (eculizumab).

That overlap has however raised worries that the Federal Trade Commission (FTC) might be concerned that Alexion’s position in the market for PNH products would become too dominant, and block the takeover on antitrust grounds.

Alexion’s interest in Achillion is centred on its portfolio of orally-active, small-molecule Factor D inhibitors headed by danicopan (ACH-4471) – in phase 2 and already being tested in combination with Soliris in PNH – and follow-up ACH-5228 in phase 1.

Achillion shareholders also stand to receive another $2 per share tied to milestones, including $1 if danicopan is approved in the US, and another $1 if ACH-5228 reaches the phase 3 testing stage.

Both Achillion’s drugs could be used in combination with Soliris as well as Alexion’s longer-acting follow-up drug Ultomiris (ravulizumab) in PNH – a life-threatening disorder in which red blood cells are destroyed by the immune system – as well as other diseases caused by over-activation of complement C5.

Achillion is developing its Factor D inhibitors for not only PNH but also C3 glomerulopathy, an ultra-rare kidney disease for which Soliris has also been tested in clinical trials but isn’t an approved indication.

Last month, danicopan picked up a breakthrough designation from the FDA for use in combination with a C5-targeting antibody in PNH patients who are not responding adequately to the C5 drug alone.

The takeover is part of a push by Alexion to reduce its reliance on Soliris, which is expected to make around $4.1bn in sales this year, up from $3.56bn in 2018, thanks to new indications such as generalised myasthenia gravis (gMG) and neuromyelitis optica spectrum disorder (NMOSD) that have broadened its reach.

The drug currently accounts for more than 80% of Alexion’s sales, but is facing the threat of biosimilar competition. While Alexion recently claimed a patent extension in the US until 2027, that is subject to a challenge by Amgen that – if successful – could open the door to biosimilar competition as early as 2021.

Other bolt-on deals to boost its product portfolio and pipeline include the $1.2bn takeover of Syntimmune and $855m purchase of Wilson Therapeutics last year.

Meanwhile, for Achillion the takeover by Alexion marks a renaissance for the company, which had to reinvent itself after a once-promising hepatitis C virus franchise faded away, taking partner Johnson & Johnson along with it.

Article by
Phil Taylor

17th October 2019

From: Sales

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