Novartis Buys Opexa's Multiple Sclerosis, T-cell Immunotherapy For $50 Million

Big pharma is increasingly stepping up to the stem cell line.  In November 2008, Osiris Therapeutics announced a strategic alliance with Genzyme for the development and commercialization of certain Osiris stem cell products. Osiris is to commercialize Prochymal and Chondrogen in the United States and Canada, and Genzyme will commercialize the treatments in all other countries. Under the terms of the agreement, Genzyme will make a $130 million up-front payment to Osiris, with $75 million paid initially and $55 million to be paid on July 1, 2009. In addition, Osiris also has the potential to receive a total of up to $1.25 billion in milestone payments from Genzyme.

The Novartis/Opexa Deal:

Now Novartis and Opexa Therapeutics have announced a product research and development sale that could bring Opexa $50 million.  The announcement was made early in the market day and Opexa closed with a market capitalization of $24.6 million having traded up from $.47 to $2.01 during the day. Under the terms of the agreement, Novartis will acquire the technology described below from Opexa. Novartis will have full responsibility for funding and carrying out all research, development and commercialization activities. Opexa will receive an upfront cash payment of $3 million, plus an additional $1 million as a technology transfer fee to be paid over the course of a six month period. Total payments to Opexa, including the upfront payment, the technology transfer fee and development and commercial milestone payments could exceed $50 million not including royalties.

What Novartis is buying:

On October 23, 2008, Opexa followed up on an announcement made a month before:

Opexa Therapeutics, Inc. (NASDAQ:OPXA), a company dedicated to the development of patient-specific cellular therapies for the treatment of autoimmune diseases such as multiple sclerosis (MS) and diabetes, today announced additional positive data from the company’s Phase IIb TERMS clinical trial (Tovaxin® for Early Relapsing Multiple Sclerosis).

The TERMS data shows that these patients when treated with Tovaxin demonstrate an ARR of 0.28 which represents a 55 percent reduction compared to those patients on placebo. This relapse rate is on par with the lowest relapse rates observed with currently available MS treatments which range from 0.2 to 0.9. Study findings also show Tovaxin possesses an impressive safety and tolerability profile. Opexa expects to conduct a Phase II close-out meeting with the United States Food and Drug Administration during the first half of 2009 to discuss next steps for the further clinical development of Tovaxin. Opexa is actively engaged in discussions with potential strategic partners for the Tovaxin program.

About the Terms Study:

The TERMS study was a Phase IIb multi-center, randomized, double blind, placebo-controlled trial in 150 patients with Relapsing-Remitting Multiple Sclerosis or high risk Clinically Isolated Syndrome (CIS). The study involved 2:1 randomization with 100 patients receiving Tovaxin and 50 receiving placebo. According to the study protocol, patients received a total of five subcutaneous injections at weeks 0, 4, 8, 12 and 24. The primary efficacy endpoint of the TERMS trial was the cumulative number of gadolinium-enhanced brain lesions (CELs) using MRI scans summed over weeks 28, 36, 44 and 52. The trial’s secondary efficacy endpoints included annualized relapse rate (ARR), new CELs at weeks 28 through 52 and T2-weighted lesion volume compared to baseline.

About Tovaxin:

Tovaxin is an individualized T-cell therapeutic vaccine that consists of attenuated patient-specific myelin-reactive T-cells (MRTCs) against peptides of proteins from Myelin basic protein (MBP), Myelin oligodendrocyte glycoprotein (MOG) and Proteolipid protein (PLP) or combinations thereof. Tovaxin’s dual mechanism of action combats the demyelination of the nerve fibers in the central nervous system, the underlying cause of MS. Clinical results have demonstrated that Tovaxin produces the following therapeutic effects: 

• Anti-idiotypic effect – Induces an immune response that depletes and regulates the circulating pathogenic myelin-reactive T-cells that attack the myelin sheath of nerve fibers. 
  


• Anti-ergotypic effect – Rebalances the overall immune system by causing a shift from pathogenic inflammatory T-cells to anti-inflammatory T-cells.

Adapted from the Opexa Therapeutics announcment.