What happened
Shares of Akcea Therapeutics (AKCA +0.00%) are up 30% at 12:25 p.m. EDT after the biotech announced a licensing deal for its drug candidate, AKCEA-ANGPTL3-Lrx, with Pfizer (PFE 1.39%). Ionis Pharmaceuticals (IONS +0.68%), which is still a majority owner of its spin-off Akcea, saw its shares jump 4%.
So what
AKCEA-ANGPTL3-LRx uses Ionis' antisense technology to knock down expression of a protein called angiopoietin-like 3 (ANGPTL3), which is responsible for regulating cholesterol, glucose, and energy metabolism. The drug is currently in a phase 2 study of patients with type 2 diabetes, hypertriglyceridemia (high triglyceride levels) and nonalcoholic fatty liver disease, which should read out in the first half of next year.
Akcea will get $250 million upfront from Pfizer. Ionis is due half of that payment, but Akcea will pay for it with $125 million in its stock. Akcea and Ionis are eligible to split development, regulatory, and sales milestone payments of up to $1.3 billion from Pfizer. They'll also split tiered, double-digit royalties on annual worldwide net sales of the drug if it's approved.
Pfizer will take over development after the current phase 2 study completes. Before Pfizer files for regulatory approval, Akcea can exercise its option to participate in the marketing of the drug with Pfizer in the U.S. and certain additional markets.
Image source: Getty Images.
Now what
Part of today's large move in Akcea's stock price has to do with a recent decline following the departures of its CEO, president, and chief operating officer last month. The press release didn't say explicitly, but it seems likely the board was unhappy with the launches of Waylivra and Tegsedi.
Today's transaction is a sign that new management can get deals done -- although presumably talks were started by the previous management -- but interim CEO Damien McDevitt still needs to show he can increase sales of Waylivra and Tegsedi.
