No­var­tis steps in to grab ex-US rights to pi­o­neer­ing gene ther­a­py Lux­tur­na with $170M deal

Vas Narasimhan

Just days ahead of Vas Narasimhan’s jump in­to the CEO’s spot, No­var­tis has swooped in with a $170 mil­lion deal to grab ex-US rights on Spark Ther­a­peu­tics’ Lux­tur­na, the first true gene ther­a­py to get a US ap­proval.

The phar­ma gi­ant is pay­ing $105 mil­lion in cash and putting an­oth­er $65 mil­lion on the ta­ble for near-term Eu­ro­pean reg­u­la­to­ry mile­stones. Spark $ONCE al­so qual­i­fies for a roy­al­ty stream on ex-US sales.

The deal leaves Spark on track to set up its own US mar­ket­ing op­er­a­tion for Lux­tur­na, which is de­signed for RPE65 mu­ta­tion-as­so­ci­at­ed cas­es of reti­nal dy­s­tro­phy.

No­var­tis will be spear­head­ing a com­mer­cial op­er­a­tion in Eu­rope that fol­lows the tracks of two oth­er ap­proved gene ther­a­pies which have on­ly man­aged to reach a hand­ful of pa­tients. And it faces some steep com­mer­cial bar­ri­ers for a ther­a­py that’s been priced at $850,000 — $425,000 per eye — in the US. Narasimhan, though, has put a big pre­mi­um on play­ing a lead­ing role in de­vel­op­ing and mar­ket­ing cell and gene ther­a­pies in key mar­kets.

Dan Fa­ga

The WAC price for Lux­tur­na in the US falls to­ward the high­er end of an­a­lysts’ bets, which ranged from about $600,000 to just un­der the $1 mil­lion mark for what’s in­tend­ed as a one-time treat­ment for the rare, sight-steal­ing ge­net­ic con­di­tion. Now the high­est priced ther­a­py in the coun­try — out­pac­ing drugs like Spin­raza at $750,000 for the first year of ther­a­py — it fell on Spark to come up with the right pric­ing mod­el that can per­suade pay­ers to cov­er the pro­ce­dure for a tiny group of un­der 2,000 po­ten­tial pa­tients, with few­er than 20 new pa­tients per year.

Wed­bush is skep­ti­cal that those kinds of pa­tient num­bers will play to No­var­tis’ fa­vor. They note:

No­var­tis’ re­sources and com­mer­cial ex­per­tise will not be able to over­come the main short­com­ing with Lux­tur­na pro­gram: an ad­dress­able pop­u­la­tion that is sim­ply too small to gen­er­ate mean­ing­ful val­ue.

No­var­tis will al­so face a group of sin­gle pay­er op­er­a­tions with con­sid­er­able lever­age over pric­ing, typ­i­cal­ly well un­der US rates.

“By lever­ag­ing No­var­tis’ large, ex­ist­ing com­mer­cial and med­ical in­fra­struc­ture in oph­thal­mol­o­gy, as well as its com­mit­ment to com­mer­cial­iz­ing ge­net­ic-based med­i­cines, we help en­sure that more pa­tients with con­firmed bial­lel­ic RPE65 mu­ta­tion-as­so­ci­at­ed reti­nal dy­s­tro­phy who live out­side the U.S., and im­por­tant­ly out­side of Eu­rope, have ac­cess to in­ves­ti­ga­tion­al voreti­gene nepar­vovec,” said Dan Fa­ga, chief busi­ness of­fi­cer, Spark Ther­a­peu­tics. And the mon­ey they’re get­ting will be put to­ward the R&D costs for the rest of their pipeline prod­ucts, in­clud­ing an ad­vanced pro­gram for he­mo­phil­ia B.

Paul Hudson, Sanofi CEO (Getty Images)

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Pablo Legorreta, founder and CEO of Royalty Pharma AG, speaks at the annual Milken Institute Global Conference in Beverly Hills, California (Patrick T. Fallon/Bloomberg via Getty Images)

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The Advance Clinical leadership team: CEO Yvonne Lungershausen, Sandrien Louwaars - Director Business Development Operations, Gabriel Kremmidiotis - Chief Scientific Officer, Ben Edwards - Chief Strategy Officer

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As oncology sponsors look internationally to speed-up trials after unprecedented COVID-19 suspensions and delays, Australia, which has led the world in minimizing the pandemic’s impact, stands out as an attractive destination for early phase trials. This in combination with the streamlined regulatory system and the financial benefits including a very favourable exchange rate and the R & D cash rebate makes Australia the perfect location for accelerating biotech clinical programs.

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