A cou­ple years af­ter li­cens­ing Novim­mune’s ema­palum­ab and turn­ing around a quick FDA OK, Stock­holm-based So­bi is bet­ting up to $1.2 bil­lion for rights to an­oth­er rare dis­ease drug.

The com­pa­ny is shelling out $250 mil­lion up­front and adding up to $915 mil­lion in mile­stones for rights to de­vel­op and com­mer­cial­ize Apel­lis Phar­ma­ceu­ti­cals’ drug pegc­eta­coplan out­side the US. To­geth­er, the com­pa­nies will see the sys­temic C3 ther­a­py through five reg­is­tra­tional tri­als in hema­tol­ogy, nephrol­o­gy and neu­rol­o­gy.

The tri­als, to run in par­al­lel, in­clude two new reg­is­tra­tional pro­grams in cold ag­glu­tinin dis­ease (CAD) and hematopoi­et­ic stem cell trans­plan­ta­tion-as­so­ci­at­ed throm­bot­ic mi­croan­giopa­thy (HSCT-TMA), both slat­ed to be­gin next year. The biotechs will al­so push for­ward with ex­ist­ing pro­grams in parox­ys­mal noc­tur­nal he­mo­glo­bin­uria (PNH); im­mune com­plex mem­bra­nopro­lif­er­a­tive glomeru­lonephri­tis (IC-MPGN) and C3 glomeru­lopa­thy (C3G); and ALS.

In ad­di­tion to the up­front and mile­stones, So­bi is sweet­en­ing the deal with $80 mil­lion in re­im­burse­ment pay­ments over a four-year pe­ri­od for R&D. Plus, Apel­lis co-founder and CEO Cedric Fran­cois said there are “dou­ble-dig­it” roy­al­ties on the ta­ble.

“This col­lab­o­ra­tion fur­ther strength­ens our al­ready strong bal­ance sheets, which we be­lieve will ex­tend our cash run­way in­to the sec­ond half of 2022,” Fran­cois said in a con­fer­ence call on Tues­day morn­ing. He added that the com­pa­ny plans to lever­age So­bi’s in­ter­na­tion­al in­fra­struc­ture, and their “strong pres­ence in key glob­al mar­kets.”

Apel­lis $APLS is keep­ing US com­mer­cial­iza­tion rights for all in­di­ca­tions, and world­wide rights for what Fran­cois said is their “largest in­di­ca­tion”: ge­o­graph­ic at­ro­phy (GA). Pegc­eta­coplan is cur­rent­ly in two Phase III tri­als for GA.

Gui­do Oelk­ers

A joint de­vel­op­ment com­mit­tee will over­see progress on the oth­er in­di­ca­tions, Fran­cois said dur­ing the call. PNH is the most ad­vanced of the 5 in­di­ca­tions — Apel­lis has al­ready sub­mit­ted an NDA, and ex­pects to hear about a PDU­FA date by the end of this year.

“Over­all, we be­lieve this deal with SO­BI is net-net a pos­i­tive one for APLS, as it should sup­port the ro­bust com­mer­cial launch of sys­temic pegc­eta­coplan in PNH and be­yond,” Baird an­a­lysts Mad­hu Ku­mar and Robert Paler­mo wrote in a note.

The up­front, they wrote, will like­ly al­low for “rapid ex­pan­sion” in­to CAD and HSCT-TMA, “where re­views sug­gest com­ple­ment ac­ti­va­tion via C3 is a key ac­ti­va­tion node and clin­i­cal case stud­ies sug­gest C5 mAbs like (Alex­ion’s) Soliris might not work where there are al­ter­na­tive path­way mu­ta­tions.”

Fran­cois said Apel­lis chose So­bi, which he called a “glob­al leader in hema­tol­ogy and rare dis­eases,” be­cause the col­lab­o­ra­tion “will be as im­por­tant to them as it will be to us.”

Two years ago, So­bi put down $50 mil­lion up­front and up to $400 mil­lion in mile­stones for the rights to ema­palum­ab — one of its stars af­ter re­struc­tur­ing to fo­cus on hema­tol­ogy and im­munol­o­gy. It lat­er ac­quired the whole pro­gram, with mile­stones adding up to $518 mil­lion. The drug, mar­ket­ed as Gam­i­fant, is ap­proved in the US for he­mo­phago­cyt­ic lym­pho­his­ti­o­cy­to­sis (HLH), and raked in $26.7 mil­lion in the first half of 2020. But in Ju­ly, the EMA re­ject­ed So­bi’s pitch for ap­proval for rea­sons CEO and pres­i­dent Gui­do Oelk­ers didn’t elab­o­rate on.

Re­gard­ing the prospects for pegc­eta­coplan, Oelk­ers said in a state­ment:

Giv­en the cen­tral role of C3 in the com­ple­ment cas­cade, pegc­eta­coplan has the po­ten­tial to be­come the foun­da­tion for a broad­er plat­form in rare dis­eases. With pos­i­tive Phase 3 da­ta in PNH, pegc­eta­coplan can el­e­vate the stan­dard of care for this de­bil­i­tat­ing blood dis­or­der.

Jazz CEO Bruce Cozadd didn’t beat around the bush.

In his first video meeting with GW Pharma chief Justin Gover last July 8, he offered to pay $172 a share to get the company, which had beaten the odds in getting its remarkable cannabinoid drug Epidiolex across the regulatory finish line for epilepsy. GW’s stock closed at $129 that day.

Cozadd had already done his homework on the financing to make sure he could swing it the way he wanted. He just needed to do some due diligence before making the non-binding bid firm.