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J&J opts in on Idorsia’s candidate for $230m

Published on 04/12/17 at 09:13am

As part of Johnson & Johnson’s acquisition of Actelion, it was able to secure a number of ties with the spinout from the deal, Idorsia. The big pharma company has now decided to take up one of its deals by plumping $230 million on the table to co-develop one of the biotech’s lead candidates.

The therapy is aprocitentan (ACT-132577), which is in development as a treatment for resistant hypertension. Both companies will jointly develop and commercialise the treatment.

As part of the deal, Idorsia will receive $160 million immediately with the further $70 million being received as contract revenue over the next three and a half years. Further than this, Idorsia revealed that it would be entitled to royalty payments worth 20% of annual net sales up to $500 million, 30% of annual net sales between $500 million and $2 billion, 35% of annual net sales $2 billion.

The early indication of success will be seen as an early positive sign for the fledgling biotech. With 600 employees and a loaded pipeline, the company needs to ensure that it brings in financial deals, such as this, to minimise the losses it can expect to incur without any treatments bringing in sales. André Muller, CFO of Idorsia, revealed that the deal would allow the company to come close to breaking even over the financial year.

The biotech does have $1 billion in the bank to fall back on but it will have to be cautious with this nest egg, having predicted that it would not see a product reach market for two to three years after inception.

Martine Clozel, Chief Scientific Officer of Idorsia, said: “With this decision, Janssen has recognised the potential of aprocitentan, the latest product from a research effort that was initiated nearly 30 years ago and resulted in a broad understanding of the endothelin system and two endothelin receptor antagonists on the market. Aprocitentan can be envisioned to have many other potential applications, in addition to hypertension. This makes the collaboration with Janssen even more meaningful for us.”

For early backers of the company, the news will represent any early vote of confidence for Idorsia – with many hoping it can replicate the success of Actelion. The share price of the company jumped on the news, rising 3.7% on the announcement of the deal.

Ben Hargreaves

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