Biogen is hustling a schizophrenia drug into PhIIb after Pfizer lets it go in $590M CNS fire sale

Pfizer’s $PFE decision to beat a retreat from its pipeline of neurosciences drugs has triggered its first asset sale.

Michael Ehlers, Biogen

Biogen $BIIB is stepping up with $75 million in cash and committing up to $515 million in milestones to seal the deal on Pfizer’s schizophrenia drug PF-04958242. The drug has been through an early-stage study, and now Biogen will add it to a lean pipeline of CNS therapies.

Biogen says this marks their first entry into neuropsychiatry.

The drug is an AMPA receptor potentiator, designed to unscramble excitatory synaptic transmission in the CNS. In the Phase Ib, researchers reported that they were able to successfully treat health volunteers by first triggering cognitive issues commonly associated with schizophrenia by dosing them with ketamine and then following up with the therapy. And that built on the rodent data they had gathered in animal studies.

Pfizer announced in early January that it was abandoning neurosciences R&D and lay off 300 staffers after a long and unsuccessful attempt to build a portfolio of drugs. The pharma giant’s website listed 8 Phase I and Phase II programs in neurosciences, its third largest concentration of pipeline efforts. Those drugs include a Phase II GABA-A receptor agonist PF-06372865 and another mid-stage effort on Parkinson’s disease. There are also 4 early-stage projects on Alzheimer’s.

Biogen, meanwhile, is boosting its neurodegeneration work, focusing much of its attention around the late-stage Alzheimer’s drug aducanumab. Analysts have been looking for the biotech player to make a landmark deal, but have been disappointed on that score so far. And they were not particularly excited by Biogen’s step here towards a more holistic CNS future. Baird’s Brian Skorney noted:

The critical issue for Biogen right now is how to grow the core business into and through aducanumab’s Phase III readouts. With pressures in MS continuing to grow into 2019 with Gilenya going generic and potential ozanimod approval, and advances by AveXis in SMA, the Street wants to see definitive moves by Biogen to fill potential gaps in MS and protect the Spinraza franchise.

Biogen, though, isn’t fretting publicly.

“When cognition is impaired, you lose the ability to make sense of the world. Things we often take for granted in our daily lives, including processing information, planning and remembering, all become difficult or impossible,” said Biogen R&D chief Michael Ehlers. “Cognition can be impaired in multiple neurological and neuropsychiatric diseases, including schizophrenia. And we know that the extent of cognitive deficits in patients with schizophrenia is a strong predictor of daily functioning. We look forward to quickly pursuing development of this potential innovative therapy to treat such a devastating disease.”

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