MorphoSys out-licenses two antibodies to secretive ARCH biotech as it pushes forward with lead Constellation work
MorphoSys is partnering and investing in a secretive ARCH-backed biotech as it continues reorganizing the pipeline following a $1.7 billion June 2021 buyout of Constellation and subsequent punting of early-stage assets.
The German company will team up with ARCH’s Human Immunology Biosciences, or HIBio for short, in a deal for two clinical programs. MorphoSys will receive a 15% equity stake in HIBio and net a $15 million upfront payment, as well as become eligible for up to $1 billion in milestone payments.
In exchange, HIBio will get licenses for the anti-CD38 antibody felzartamab and the anti-C5aR1 antibody MOR210. HIBio will have rights to these compounds everywhere except China, Hong Kong, Taiwan and Macau, where MorphoSys had signed previous licensing deals with I-Mab. (I-Mab also has rights to MOR210 in South Korea).
Tuesday’s deal is MorphoSys’ latest effort to reorganize after it bought out Constellation last June for a ten-figure sum. At the time, MorphoSys made no secret of its ultimate prize: pelabresib, an experimental BET inhibitor, currently in Phase III in myelofibrosis.
Constellation revealed at December 2020’s ASH conference that 67% of Phase II patients given pelabresib in combination with Jakafi as a first-line treatment saw a reduction in spleen volume of 35% or greater at 24 weeks. In a statement Tuesday, MorphoSys CEO Jean-Paul Kress said the deal would allow the company to focus its resources on developing the program.
A few months ago, MorphoSys made its first move to funnel cash toward this candidate by writing off all other Constellation-related work for $250 million, save for one other clinical program. In tandem, the company discontinued its US-based discovery work for those Constellation projects and centralized all lab efforts in Germany, effectively ending its early pipeline projects.
The write-off also helped MorphoSys better commercialize its only approved drug, Monjuvi, the company said at the time. FDA approved Monjuvi, a CD-19-directed therapy, for refractory diffuse large B-cell lymphoma in August 2020.
HIBio, meanwhile, has remained under the secretive ARCH incubator umbrella with all the makings of another big Bob Nelsen project. The company’s website does not relay much info, but does note its primary focus will be autoimmune and inflammatory diseases.
Its co-founder and CEO, Travis Murdoch, previously worked at SoftBank, Third Rock and McKinsey while serving on a few company boards such as Zymergen, per his LinkedIn page. ARCH managing partner Paul Berns also chairs HIBio’s board.