Baxalta, the US biotech company facing renewed takeover interest from Shire, has agreed a deal worth up to $1.6bn to develop cancer drugs with a Danish company called Symphogen.
The partnership, announced on Monday, signalled Baxalta’s determination to press ahead with its own plans even as talks continue over a potential sale to UK-listed Shire for more than $30bn.
The deal could further increase the appeal of Baxalta to Shire, whose chief executive, Flemming Ornskov, has expressed a desire to expand into cancer drugs. However, adding further potential assets to Baxalta’s pipeline could complicate negotiations over a sale to Shire.
Baxalta resisted a $30bn all-share offer from Shire in August, but people close to the situation say talks have since made progress towards a higher bid that would be sweetened with a cash component.
In the tie-up with Symphogen, Baxalta has agreed to make an upfront payment of $175m to the Danish company in exchange for exclusive rights to six cancer “immunotherapies” that it has in pre-clinical development. Further sums would be payable subject to progress through clinical studies, up to a maximum of $1.6bn.
Illinois-based Baxalta — spun-off last year from US medical group Baxter — is best known for its treatments for haemophilia, the rare blood disorder, but it also has a presence in immunology and oncology.
The Symphogen deal is focused on a burgeoning area of cancer research called immuno-oncology, which involves boosting the ability of the body’s immune system to hunt and destroy cancer cells.
David Meek, head of oncology for Baxalta’s cancer business, said the alliance was “just the beginning of our focus in building world-class capabilities in immuno-oncology”.
Few details were given about the six drug candidates to be worked on with Symphogen other than that they would be “checkpoint therapies”, which aim to clear a path for disease-fighting white blood cells to attack tumours.
Under the terms of the deal, Symphogen will be responsible for early clinical development, due to start in 2017, at its own expense; Baxalta will then have an exclusive option to take the therapies through later-stage trials to market.
Kirsten Drejer, Symphogen chief executive, said: “We know how to clone the antibodies and take them through pre-clinical studies; Baxalta has the machinery for late-stage development and commercialisation.”
The partnership will provide privately owned Symphogen with funds to push forward its own development pipeline, including a treatment for colorectal cancer in mid-stage trials. Its biggest shareholder is the investment arm of Novo, the holding company that controls Novo Nordisk, the Danish drugmaker.
Symphogen is focused on antibody therapies that use genetically engineered proteins to target diseased cells and tissue. It is pursuing similar technology to Genmab, another, more mature Danish drug developer which has emerged as one of Europe’s most promising biotech companies.