A large part of a $5 billion bet that Gilead Sciences (NASDAQ:GILD) made in 2019 has fallen apart in late clinical-stage development. The bottom fell out from under ziritaxestat, a new drug candidate Gilead Sciences was developing in partnership with Galapagos (NASDAQ:GLPG), when the partners announced all clinical trials with the experimental autotaxin inhibitor would be discontinued on Wednesday morning.
In a mid-stage idiopathic pulmonary fibrosis (IPF) study, patients treated with ziritaxestat showed lung function improvements, while those given a placebo declined significantly. The candidate also produced compelling efficacy data in a mid-stage study with systemic sclerosis patients.
Mid-stage efficacy data were so good that it was most likely a safety concern that raised the drug's risk-to-benefit ratio up to an untenable level. The partners haven't set a date, but we'll find out more when they present detailed results at a future medical conference.
This isn't the first time Gilead's partnership with Galapagos disappointed investors. Last October, Galapagos also reported a mid-stage clinical-trial failure with an experimental osteoarthritis treatment called GLPG1972. Gilead hadn't executed its option to in-license GLPG1972, but a Galapagos-partnered program Gilead Sciences had licensed imploded around the same time.
Last fall, Gilead gave up on developing filgotinib, a potential rheumatoid arthritis treatment that had been expected to generate blockbuster sales before the FDA refused to approve it last summer.
Excluding sales of its COVID-19 treatment, Veklury (remdesivir), Gilead Sciences reported total revenue that contracted 3% last year. Without any potential blockbusters in late-stage development, the company is depending on sales of Trodelvy (a new breast cancer drug the company acquired for around $21 billion last September) to drive growth. After earning FDA approval last April, Trodelvy sales reached just $137 million in 2020.