Novartis has agreed to acquire the exclusive global development and marketing rights of atopic dermatitis drug MOR106 from MorphoSys and Galapagos in a deal that could go up to $1.1 billion.
The Swiss drugmaker will make an upfront payment of €95 million ($111 million) to Galapagos and MorphoSys apart from potential milestone payments of up to nearly €850 million ($1 billion) and royalties up to low-teens to low-twenties.
As per the agreement terms, the three pharma companies will cooperate to significantly expand the existing development plan for MOR106 in atopic dermatitis.
Novartis will exclusively have all rights for commercialization of any products resulting from the agreement signed with Galapagos and MorphoSys.
About Atopic Dermatitis Drug MOR106
An IgG1 monoclonal antibody, MOR106 selectively targets the Interleukin 17C (IL-17C) protein. The atopic dermatitis drug was developed in collaboration between German biotechnology company MorphoSys and Belgo-Dutch pharmaceutical research company Galapagos.
In a Phase Ib study, MOR106 had shown first signs of efficacy and was generally safe and well tolerated.
Dr. Simon Moroney, CEO of MorphoSys, commenting on the deal with Novartis made on the atopic dermatitis drug MOR106, said: “This collaboration with Novartis will enable us to accelerate and broaden the development of MOR106 beyond our current focus on atopic dermatitis and to exploit the potential of MOR106 to the maximum.
“Data from preclinical models and expression analyses suggest that the target of MOR106 might be involved in other diseases, which justifies expanding the development program.
“We are also very pleased that we can further strengthen our engagement in atopic dermatitis by starting additional trials together with Galapagos, which will be fully reimbursed by Novartis.”
Novartis said that the in-licensing of the atopic dermatitis drug reflects its commitment to lead immuno-dermatology, while adding to its product portfolio made up of Cosentyx and Xolair.
Commenting on the acquisition of the licensing rights of the atopic dermatitis drug MOR106, Eric Hughes – Global Development Unit Head, Immunology, Hepatology and Dermatology, said: “We are a leader in immuno-dermatology and committed to reimagining the care of patients with severe diseases such as psoriasis, chronic spontaneous urticaria and atopic dermatitis. There is a key role for biologics to treat these severe diseases, which are more than just skin conditions, as they have complex underlying root causes.
“We are pleased to work with Galapagos and MorphoSys who have a proven track record of developing drug candidates for severe inflammatory diseases.”
The closing of the license agreement for the atopic dermatitis drug MOR106 will be based on clearance by the US antitrust authorities as per the Hart-Scott-Rodino Act.