- Taiho Pharmaceutical is buying back rights to an experimental cancer drug aimed at a genetic driver of lung tumors after licensing it to Cullinan Oncology two years ago.
- The Japanese drugmaker discovered the medicine and, rather than develop it in-house, sold it to Cullinan, which advanced the treatment from laboratory-stage research into position to enter pivotal testing later this year. In the deal announced Thursday, Taiho will reacquire partial rights to the drug for $275 million upfront and as much as $130 million more if the therapy hits certain development milestones
- Per the agreement, Taiho will acquire the Massachusetts biotech’s Cullinan Pearl subsidiary, gaining rights to sell the drug in all markets outside the U.S. and China. Cullinan and Taiho will jointly develop the therapy and, if successful, share profits and commercialize it together in the U.S. Cullinan previously licensed rights in China to Zai Lab.
The deal positions Cullinan for future profits on its drug, while giving the company an infusion of funds that extends its cash runway through 2026. Cullinan shares jumped by more than 20% in early trading, though at about $9 each, they still trade well below their $21 price in January 2021.
Cullinan and Taiho’s drug, currently in early-stage research, is designed treat patients who have a mutation known as an exon 20 insertion in a gene called EGFR. When the mutation is present, the gene can spur the body to grow cells too quickly, leading to tumors.
While EGFR-targeting drugs have been around for a while — Roche’s Tarceva and AstraZeneca’s Tagrisso are among them — drugmakers have recently zeroed in on exon 20. In 2021, the Food and Drug Administration approved Johnson & Johnson’s Rybrevant and Takeda’s Exkivity for lung cancers with that specific mutation.
Smaller companies are also getting in on the action. In November, Blueprint Medicines announced plans to buy Lengo Therapeutics and its exon 20-targeting drug for $250 million in cash. Dizal Pharma has a drug in early-stage testing, and Scorpion Therapeutics, a well capitalized, privately held biotech, could bring one to human trials next year. The space has become so competitive that one company, Black Diamond Therapeutics, shelved a drug in clinical trials and changed its strategy because of the “rapid evolution of the treatment landscape.”
Like Exkivity, Taiho’s drug is given orally. The FDA earlier this year granted the medicine a Breakthrough Therapy designation, a process designed to speed development and review for therapies that may offer significant improvements over existing treatments. About 38,000 non-small cell lung cancer patients a year would be candidates for drugs that specifically target EGFR exon 20 mutations, Cullinan said.