Sobi On The Look-Out For Licensing, M&A Opportunities

Swedish Orphan Biovitrum AB may be in a launch phase with first sales of its long-acting hemophilia products in Europe, but the company is already looking ahead to use its growing commercial capabilities for other products.

While Swedish Orphan Biovitrum AB (Sobi) is “totally focused on execution” of the launches of its two new hemophilia products, the long-acting Factor VIII product Elocta (efmoroctocog alfa) and the long-acting Factor IX product Alprolix (eftrenonacog alfa), the company is alive to the business opportunities that come from having a growing commercial operation.

The senior team at the Stockholm-based company is “now spending significant time looking at M&A and partnering up candidates to bolster our mid- and late-stage pipeline,” said Sobi CEO Geoffrey McDonough in an analysts' telephone briefing on the company’s second-quarter results, held July 15. When asked to name the type of product or company Sobi was after, he suggested products that could be launched in early 2018 and later were the kind of assets the company was interested in.

Sobi has been building up its European hemophilia commercial organization for some time, and during last year added more than a 100 new employees to its headcount. Under a collaboration with US firm Biogen, Sobi has commercialization rights for Europe, North Africa, Russia and most Middle Eastern markets for the two hemophilia products. Biogen already markets the Factor VIII product (as Eloctate) and Factor IX product, Alprolix in the US.

Responding to a question about Sobi’s view on Biogen’s plans to spin-out its hemophilia franchise, McDonough said Sobi believed the process would create a focused and dynamic company and would be a huge positive, but would not lead to any meaningful restructuring of its relationship with Sobi. The spin out is expected to take place by the end of 2016 or in early 2017 (Also see "Biogen Backs Out Of Hemophilia, But Who Benefits?" - Scrip, 3 May, 2016.).

And giving Sobi some extra strategic flexibility was the repayment during the second quarter of this year of a SEK 800m ($93m) bond, a year ahead of schedule, and its replacement with a long-term loan facility of SEK 500m. The new loan facility will also lower costs, McDonough said.

Positive Response From Payers

The build-up of Sobi’s hemophilia commercial operation is now complete, McDonough noted, and Elocta was approved for marketing in Europe in November 2015, and Alprolix in May 2016. Payers have “responded in a positive way” to the company’s approach to pricing of the new products, McDonough contended.

“We have not taken a very high premium price, we have tried to make these next-generation products broadly available to most patients,” he remarked. But it has not been all “unicorns and cinnamon”, he added, suggesting that pricing and reimbursement negotiations may have been tough.

The second quarter of this year was the first full quarter for sales of Elocta, and sales totaled SEK 55m. The product is being reimbursed in Germany, the Netherlands, Ireland and Sweden, and NHS framework agreements have been agreed in Northern Ireland, Wales and Scotland, with agreement nearing completion in England, reported COO Alan Raffensperger.

Patients in Germany are being switched from other on-demand and prophylactic Factor VIII therapies, with the majority believed to be patients previously on other prophylactic therapies, he added.

In the second quarter, Sobi also began selling Alprolix, administered once-weekly, in Germany, the Middle East and the UK, and product sales totalled SEK 5m. A potential competitor, CSL Ltd.’s Idelvion (albutrepenonacog alfa) administered every two weeks, was approved for marketing in Europe in May (Also see "PIPELINE WATCH – Eight Approvals, Five Orphan Designations And One Filing" - Scrip, 13 May, 2016.). McDonough noted that from feedback Sobi was getting, patients and clinicians appear to prefer once-weekly dosing, but whether this was an important difference between the two products will have to await further market experience.

McDonough noted that clinical trials of additional indications for the marketed therapy for moderate to severe active rheumatoid arthritis, Kineret (anakinra), are expected to start at the end of the year or the beginning of 2017, including for acute gout and Still’s disease, and with approval of the indications expected in 2019 or 2020. In acute gout, there will be a dose-ranging Phase II study followed by a Phase III study, while for Still’s disease a Phase III study will take place, he added.