Celgene cuts back Jounce alliance ahead of BMS merger

Celgene has amended its partnership with Jounce Therapeutics, cutting back a once broad alliance to focus on just one molecule.

That molecule is oncology agent JTX-8064, an antibody that targets the LILRB2 receptor on tumour-related macrophages.

The companies signed a major $2.6bn partnership just three years ago, but have now agreed to end this deal and refocus around JTX-8064.

Jounce now takes back full worldwide rights to the rest of its pipeline, including the ICOS-targeting vopratelimab, PD-1 inhibitor JTZ-4014 and all discovery programmes.

The new agreement sees Jounce receive a $50m non-refundable licence fee, with up to $480m from Celgene in milestone payments, as well as royalties on potential worldwide sales when and if the product reaches the market.

Celgene will take the lead on the development and commercialisation of JTX-8064.

The renegotiation reflects Celgene’s preparation for its merger with BMS, and is aimed at ending overlaps in the future combined company’s pipeline.

BMS has its own anti-ICOS agonist, BMS-986226, in clinical trials and the approved PD-1 inhibitor Opdivo, making it logical for Celgene to hand back rights to vopratelimab and JTZ-4014.

Despite the thinning down of the alliance, the news was greeted enthusiastically by Jounce investors, with its shares rising more than 30% on Wednesday. The confirmation of a continuing alliance is good news for the biotech firm, which saw its shares plummet after underwhelming results for vopratelimab were presented at ASCO last year.

Jounce must now deliver positive results from its phase 2 EMERGE clinical trial of vopratelimab in combination with ipilimumab and the phase 1 trial JTX-4014. The first results of the EMERGE trial are expected in 2020, with the completion of JTX-4014 expected this year.

Meanwhile, concerns from the US regulator the Federal Trade Commission (FTC) means Celgene must first sell off its psoriasis blockbuster Otezla in order to satisfy anti-trust regulations. This will delay the $74bn merger, which now won’t be completed until late 2019 or even into 2020.