Alexion deal lends late-stage support to Stealth

Alexion continued its run of deals by obtaining an option to a Phase III candidate from Stealth, which would get a boost in building its commercial infrastructure ahead of a regulatory submission next year and be able to devote more resources to its earlier stage programs.

Alexion Pharmaceuticals Inc. (NASDAQ:ALXN) will receive an option to license exclusive ex-U.S. rights as well as rights to co-promote and develop subcutaneous elamipretide in the U.S. The company can opt in after data is reported from the Phase III trial in primary mitochondrial myopathy, which is expected in January. Stealth said an NDA submission to FDA is tentative for 3Q20.

Stealth BioTherapeutics Corp. (NASDAQ:MITO) will receive $30 million up front, comprising a $15 million equity investment, an undisclosed option fee and development funding.

Stealth CEO Reenie McCarthy told BioCentury that the company has been searching for a partner for ex-U.S. rights so it can devote more resources to the other programs in its pipeline. Co-commercializing with Alexion in the U.S., she said, “enables us to build our commercial infrastructure under the umbrella of an established player in the space.”

“Rather than ramping up slowly as we build our infrastructure and sales team over time, we think that this could expedite our ramp-to-peak year sales by several years,” McCarthy said.

The company’s second candidate, SBT-272, is in preclinical development for rare neurodegenerative diseases.

If Alexion exercises its option, Stealth is eligible to receive an exercise fee, additional equity investment, development funding and milestones. Details are not disclosed.

Besides primary mitochondrial myopathy, Alexion would have U.S. rights to elamipretide in Barth syndrome and Leber hereditary optic neuropathy, for which the compound is in Phase II/III and Phase II trials, respectively.

Elamipretide is a mitochondrial-targeting tetrapeptide that binds and stabilizes cardiolipin to promote electron transfer and prevent apoptosis.

Stealth gained $0.70 (11%) to $7.10 Thursday; Alexion added $3.51 to $98.35.

After restructuring in 2017 following the departures of CEO David Hallal and CFO Vikas Sinha and trimming early stage programs from its pipeline, Alexion was left with a pipeline composed almost entirely of new indications for either its flagship drug Soliris eculizumab or its long-acting successor Ultomiris ravulizumab-cwvz. The company has since bulked up its rare disease pipeline ahead of losing patent protection for Soliris, which now could come as early as 2021 (see “Refilling Alexion’s Cupboard” & “Alexion Sinks as PTAB Institutes Review that could Shorten Soliris’ Exclusivity”).

The company’s recent deals include a partnership with Zealand Pharma A/S (CSE:ZEAL; NASDAQ:ZEAL) for rights and options to targets in the complement pathway; a partnership with Affibody AB (Solna, Sweden) to jointly develop a Phase I antibody for autoimmune diseases; and an RNAi therapeutics deal with Dicerna Pharmaceuticals Inc. (NASDAQ:DRNA) (see “Alexion Augmenting Pipeline”).

Separately Thursday, Alexion hired Tanisha Carino as EVP and chief corporate affairs officer, a new position. She was the executive director of FasterCures, a center of the Milken Institute dedicated to speeding up and improving medical research.

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