Merck & Co/MSD has persuaded cancer biotech Peloton Therapeutics to abandon its plans for a stock exchange listing, and instead add its drug candidates to the big pharma’s oncology pipeline.
Merck is paying $1bn upfront for Peloton – well ahead of the $160m the biotech hoped to raise via an IPO – with another $1.2bn in milestones tied mainly to the fortunes of its lead drug PT2977, an orally-active inhibitor of emerging oncology target hypoxia-inducible factor-2α (HIF-2α).
It is the second pipeline-boosting deal for Merck in three months, coming after it paid $300m for cancer vaccine developer Immune Design. It ties in with CEO Ken Frazier’s pledge to make bolt-on acquisitions to bolster Merck’s internal R&D as it starts to look beyond immuno-oncology powerhouse Keytruda (pembrolizumab) which now accounts for a fifth of Merck’s pharma sales.
Buying Peloton gives the pharma another mid-stage cancer candidate, as PT2977 is in a pair of phase 2 trials involving patients with renal cell carcinoma (RCC) as well as earlier-stage trials in aggressive brain cancer glioblastoma multiforme (GBM).
Hypoxia – a lack of oxygen – is often seen within solid tumours and is a major obstacle for radiotherapy and many cytotoxic cancer drugs. Malignant cells in hypoxic areas of tumours activate HIFs to adapt to the low oxygen levels, and these pathways tend to make tumours aggressive and worsen the prognosis for the patient.
Recognising that, HIF inhibitors have become a major target for drug developers, but despite a couple of decades of effort none have yet been approved for use, mainly due to the challenges of delivering them to tumours, safety and limited efficacy.
Peloton has opted to specifically target HIF-2α, which is activated as a result of the inactivity of the on Hippel-Lindau (VHL) tumour suppressor protein. VHL is seen in over 90% of cases of clear cell RCC, the most common form of kidney cancer.
The biotech’s first phase 2 trial recruited patients with VHL mutations and is testing PT2977 as a monotherapy, while a second all-comer metastatic RCC trial is pairing the drug with Exelixis/Ipsen’s multikinase inhibitor Cabometyx (cabozantinib).
Keytruda is already making waves in RCC, having been approved for first-line RCC alongside Pfizer’s Inlyta (axitinib) in April.
A third Phase 1/2 study is testing PT2977 in patients with advanced solid tumours, including RCC, with an expansion arm studying the treatment in GBM, a tough-to-treat tumour which has recently seen some late-stage trial failures involving AbbVie’s Depatux-M (depatuxizumab mafodotin) and Bristol-Myers Squibb’s checkpoint inhibitor Opdivo (nivolumab).
The deal also gives Merck an early-stage asset for pulmonary artery hypertension – called PT2567 – which is heading for phase 1 testing.
“Merck is recognised as a leader in cancer research and shares our commitment to accelerating the development of candidates targeting HIF-2α to help patients with advanced cancers and other diseases,” said John Josey, Peloton’s CEO.
“We are proud to have advanced PT2977 to this stage of development and believe that Merck is well suited to build upon the progress our company has made.”