Home Colorectal Cancer Nektar sells off royalties on its 2 approved drugs for $150M in...

Nektar sells off royalties on its 2 approved drugs for $150M in cash, redoubling focus on I-O candidates – Endpoints News


A lit­tle less than a year ago, an FDA ad­comm unan­i­mous­ly re­ject­ed Nek­tar Ther­a­peu­tics’ opi­oid pro­gram, ef­fec­tive­ly send­ing it to the chop­ping block. Now, look­ing for a quick cash in­fu­sion to fi­nance clin­i­cal tests for two oth­er can­di­dates, Nek­tar will sell off roy­al­ties for its on­ly two ap­proved US med­i­cines.

Roy­al­ties on fu­ture sales of part­ner meds Adyno­vate and Movan­tik will be turned over to Health­care Roy­al­ty Man­age­ment in ex­change for $150 mil­lion in cash, San Fran­cis­co-based Nek­tar an­nounced Tues­day morn­ing. HCR is ex­pect­ed to make the pay­ment by the end of the year, and Nek­tar said it plans to put the funds to­ward clin­i­cal tri­als for its ear­ly- and late-stage im­mune-on­col­o­gy pro­grams tar­get­ing IL-2 and IL-15.

In­vestors were most­ly mut­ed on the news, with Nek­tar $NK­TR shares up as much as 4% in ear­ly Tues­day trad­ing. But by the clos­ing bell, the stock price had fall­en to most­ly flat.

With the deal, HCR is el­i­gi­ble for roy­al­ty pay­ments of up to $210 mil­lion for each drug through 2025; if that fig­ure isn’t met by then, $240 mil­lion for each. Once those num­bers are reached, roy­al­ty rights will be re­turned to Nek­tar.

Adyno­vate is a he­mo­phil­ia A drug on which Nek­tar part­nered with Bax­al­ta, a for­mer Shire com­pa­ny now owned by Take­da. It’s an ex­tend­ed half-life re­com­bi­nant fac­tor VI­II (rFVI­II) treat­ment. Per the terms of Nek­tar’s col­lab­o­ra­tion with Bax­al­ta, Nek­tar had been el­i­gi­ble for roy­al­ties of 4% to 6% on the first $1.2 bil­lion in year­ly sales, fol­lowed by a flat 13% roy­al­ty on every sub­se­quent dol­lar.

Movan­tik, mean­while, was de­vel­oped in tan­dem with As­traZeneca for opi­oid-re­lat­ed con­sti­pa­tion in adults. Nek­tar had pinned the drug as a po­ten­tial block­buster, but sales got off to a slow start af­ter its 2014 ap­proval. Even­tu­al­ly, As­traZeneca sold most of Movan­tik’s glob­al rights to Red­Hill Bio­phar­ma for $67.5 mil­lion back in Feb­ru­ary.

Un­der its deal with As­traZeneca, Nek­tar was to re­ceive es­ca­lat­ing roy­al­ties on the drug start­ing at 20%.

Nek­tar’s cash in­fu­sion will go main­ly to­ward two of its pro­grams: be­m­pe­galdesleukin (or NK­TR-214) and NK­TR-255. The for­mer is the com­pa­ny’s cur­rent lead pipeline pro­gram, a CD122-pref­er­en­tial IL-2 ag­o­nist, and is be­ing stud­ied in sev­er­al Phase III tri­als in com­bi­na­tion with Bris­tol My­ers Squibb’s Op­di­vo. Some of the in­di­ca­tions be­ing looked at in­clude metasta­t­ic melanoma, re­nal cell car­ci­no­ma and mus­cle-in­va­sive blad­der can­cer.

Re­searchers are al­so look­ing at be­m­pe­galdesleukin as a monother­a­py and in com­bi­na­tion with Keytru­da and oth­er in-house pro­grams, though those stud­ies are ear­li­er in the de­vel­op­ment stages.

NK­TR-255 is an IL-15 re­cep­tor ag­o­nist that Nek­tar says is de­signed to ex­pand NK cells. The can­di­date, whol­ly owned by Nek­tar, is in two Phase II stud­ies — one for non-Hodgkin’s lym­phoma and mul­ti­ple myelo­ma in com­bo with Rit­ux­an or Darza­lex, and an­oth­er in head, neck and col­orec­tal can­cer paired with Er­bitux.

Nek­tar got off to a rough start in 2020 when its opi­oid pro­gram was re­buffed by an FDA ad­comm 27-0 in Jan­u­ary. The for­mer pro­gram, dubbed NK­TR-181, had been billed by the com­pa­ny as a less-ad­dic­tive op­tion to oxy­codone, but reg­u­la­tors as well as ad­comm mem­bers not­ed the de­clin­ing use of opi­oids by physi­cians across the coun­try.

The agency was al­so con­cerned over the fact that the ex­per­i­men­tal drug could still be phys­i­cal­ly ma­nip­u­lat­ed, af­ter which it could be sub­ject to abuse. CEO Howard Robin had laid out a glow­ing sales pitch for the pro­gram in 2017, on­ly to change his plans and spin it out in­to a new sub­sidiary in 2019.


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