Sobi Returns To Deal-Making With ADC Lymphoma Licensing Pact
Pays $55m Upfront For Rights To Zynlonta
Executive Summary
The Swedish rare disease specialist has expanded its hematology franchise by getting the European rights to ADC Therapeutics’ Zynlonta, which has yet to make much impact commercially in the US.
Swedish Orphan Biovitrum AB(Sobi) has been pretty quiet on the business development front since an $8.1bn buyout by a private equity syndicate fell through at the end of last year but the company has now splashed out $55m upfront to get the rights in Europe and most international markets to ADC Therapeutics SA’s lymphoma treatment Zynlonta.
Zynlonta (loncastuximab tesirine) is an antibody-drug conjugate targeting CD19, a protein expressed on the surface of B-cells. In April last year, it received US Food and Drug Administration granted accelerated approval as a single-agent treatment for adults with relapsed or refractory diffuse large B-cell lymphoma (DLBCL) after two or more lines of systemic therapy.
Zynlonta has been under regulatory review in the EU since October 2021 with a decision expected in the first quarter of 2023. Sobi will pay out an extra $50m if the European Commission approves the drug in third-line DLBCL.
In addition, Sobi will pay royalties in the mid-teens to mid-twenties per cent and up to $330m in potential regulatory and sales milestones. Zynlonta, which has orphan drug designation in the EU, is also being developed in earlier treatment lines for DLBCL, as well as other B-cell malignancies such as follicular lymphoma, and Sobi will contribute 25% of the development costs to ADC up to a cap of $10m a year.
Sobi said the agreement augmented its strategic presence in hematology and CEO Guido Oelkers claimed that Zynlonta will benefit from the firm's "heritage and strong presence" in the space. He cited the benefits of hopefully marketing the drug alongside Doptelet (avatrombopag), Sobi's oral thrombopoietin receptor agonist which is approved for primary chronic immune thrombocytopenia (ITP).
First approved for primary chronic ITP in June 2019, Doptelet has become a decent earner for Sobi, with sales jumping by 197% in the first quarter of 2022 to SEK593m ($56m). It is now the company's second-biggest seller behind the Sanofi-partnered hemophilia A factor VIII drug Elocta/Eloctate (efmoroctocog alfa).
Sobi has got high hopes for once-weekly efanesoctocog alfa which is being developed as a successor to Elocta. Promising Phase III data were presented at the International Society on Thrombosis and Haemostasis congress over the weekend, showing that the recombinant Factor VIII therapy provided clinically meaningful bleed protection for people with severe hemophilia A.
Back to Zynlonta and Sobi will be hoping for a successful launch next year, although its start across the Atlantic with ADC has hardly been stellar. In the first quarter of 2022, Zynlonta brought in $16.5m, which was lower than the previous quarter, with the company claiming that there were fewer new patient starts in the DLBCL market, a situation exacerbated by the Omicron surge.
ADC continues to be upbeat about the prospects for Zynlonta, its only approved product, saying that awareness and familiarity of the product continues to increase among physicians. Securing a permanent J code in April should also help reimbursement and further bolster sales for the rest of the year.
The pact with ADC should kickstart more deal-making at Sobi which Oelkers acknowledged at the beginning of the year had stalled following the decision by US private equity firm Advent International and Singapore’s Aurora Investment – which together comprised Agnafit Bidco AB – to withdraw their offer last December to take over Sobi. The partners pulled out because less than 90% of shareholders agreed to tender their shares, a situation complicated by minority shareholder AstraZeneca PLC refusing to tender its approximately 8% stake in Sobi. (Also see "Sobi Loses Private Equity Buyout" - Scrip, 3 Dec, 2021.)
Since then, Oelkers has spoken of his desire to build Sobi out as a global leader in rare disease and do deals similar to the tie-up with Apellis Pharmaceuticals, Inc. signed in October 2020. That partnership saw the Stockholm-based group pay $250m upfront for rights to Apellis's Empavali (pegcetacoplan), a targeted C3 therapy approved last year for the treatment of paroxysmal nocturnal hemoglobinuria. (Also see "Sobi Ramps Up In Rare Diseases With Apellis Deal" - Scrip, 28 Oct, 2020.) (Also see "Apellis Has New Hope for Pegcetacoplan With Longer-Term Data" - Scrip, 16 Mar, 2022.)