AstraZeneca’s partnership with Daiichi Sankyo led to FDA approval of an antibody cancer drug late last year. Now the British pharmaceutical giant is paying $1 billion up front to join forces on another antibody drug addressing a different cancer target.
The deal announced Monday calls for AstraZeneca (NYSE: [[ticker:AZN]]) to share in the development and, if approved, commercialization of the drug, DS-1062, globally. The deal excludes Japan, where Daiichi Sankyo is keeping exclusive rights.
The Daiichi Sankyo drug is an antibody drug conjugate (ADC), a type of therapy that hitches a powerful cancer-killing compound to a targeting antibody. This approach is intended to directly hit cancer cells, sparing healthy cells from the toxic effects of the therapy. Daiichi Sankyo designed the drug to target trophoblast cell-surface antigen (TROP2), a protein found in abundance on the surface of tumor cells for several types of cancer.
The FDA approved the first TROP2-targeting ADC therapy in April for triple-negative breast cancer. That drug, sacituzumab govitecan (Trodelvy), was developed by Morris Plains, NJ-based Immunomedics (NASDAQ: [[ticker:IMMU]]). Daiichi Sankyo’s TROP2-targeting drug is in Phase 1 testing in non-small cell lung cancer and triple-negative breast cancer. In preclinical studies, the company has reported that its drug selectively bound to the TROP2 receptor on the surface of a tumor cell. The drug is intended to be taken into the cancer cell where its tumor-killing payload is deployed. Daiichi Sankyo says DS-1062 has the potential to be the best of the TROP2-targeting class of drugs.
Several companies are also developing ADC therapies addressing various cancer targets, and there are ties among many of them. Bothell, WA-based Seattle Genetics (NASDAQ: [[ticker:SGEN]]) nearly acquired the Immunomedics drug in 2017 until opposition from the New Jersey company’s shareholders unwound the deal.
SeaGen (NASDAQ: [[ticker:SGEN]]) has commercialized three ADC cancer drugs and is developing a pipeline of others through various partnerships. Daiichi Sankyo reached a 2008 deal licensing ADC technology from SeaGen. But the Japanese company says its ADC drugs are based on its proprietary ADC technology, called DXd, and it has challenged SeaGen’s patent claims. Meanwhile, Switzerland-based ADC Therapeutics (NYSE: [[ticker:ADCT]]), whose lead ADC candidate is in a pivotal test in diffuse large B-cell lymphoma, counts AstraZeneca as a minority shareholder.
The AstraZeneca/Daiichi Sankyo alliance on DS-1062 follows a 2019 deal on a different ADC, trastuzumab deruxtecan (Enhertu), which also emerged from the Japanese company’s pipeline. AstraZeneca agreed to make a $3.5 billion equity investment in its partner to develop and commercialize the drug, which was designed to target changes in HER2 protein that helps breast cancer cells grow, divide, and spread.
The FDA approved that drug last December for breast cancer patients whose tumors are positive for HER2 and cannot be removed with surgery or have spread. It’s a third-line treatment, approved for cancers that have failed two earlier HER2 cancer drugs. The regulatory decision comes with a boxed warning on the drug’s label cautioning physicians and patients that the treatment comes with the risk of scarring and inflammation in the lungs.
For the alliance on DS-1062, AstraZeneca is paying the upfront fee to Daiichi Sankyo in installments. The first payment, $350 million, is due upon the execution of the deal. AstraZeneca will pay $325 million more after one year and another $325 million after two years. Regulatory milestone payments could bring Daiichi Sankyo an additional $1 billion. If the drug reaches the market, the Japanese company could earn up to $4 billion more upon reaching undisclosed sales targets.
Image: iStock/Roland Magnusson
