Biogen Spinning Off Hemophilia Business to Focus On Neurological Disorders

Biogen Spinning Off Hemophilia Business to Focus On Neurological Disorders May 3, 2016
By Mark Terry, Breaking News Staff

Cambridge, Mass.-based Biogen announced today that it will spin off its hemophilia business as an independent, public company.

The new, as-yet unnamed company, will be anchored by its two lead products, Eloctate and Alprolix, for hemophilia A and B, respectively. It plans to continue developing and commercializing the two drugs under Biogen’s existing deal with Swedish Orphan Biovitrum AB.

This spinoff will allow Biogen to focus on central nervous system disorders, primarily multiple sclerosis (MS), Alzheimer’s, Parkinson’s disease, amyotrophic lateral sclerosis (ALS), spinal muscular atrophy (SMA) and neuropathic pain.

“We expect that the new company will be a leader in discovering, developing, and commercializing innovative therapies for hemophilia, built on remarkable science and a deep understanding of how to continually improve treatment for patients,” said George Scangos, Biogen’s chief executive officer, in a statement. “Our expanding hemophilia business continues to perform very well. Eloctate and Alprolix provide meaningful benefits for people living with hemophilia and continue to gain market share. We believe that the best way to realize the full potential of this growing and vital business is to enable it to operate independently with a management team dedicated to providing therapies to people living with hemophilia.”

The spinoff will be handled through the distribution of shares in the new company to existing Biogen stockholders. It is expected to be completed by the end of 2016 or beginning of 2017. It will probably be headquartered in Boston.

The new company will be run by Biogen’s current executive vice president of Pharmaceutical Operations & Technology, John Cox, who will be the chief executive officer. Cox has been with Biogen since 2003.

“When Biogen brought Eloctate and Alprolix to market in 2014,” said Cox in a statement, “they represented the first major treatment advances in nearly two decades for people living with hemophilia. I’m extremely excited to build on this legacy, lead a management team that’s passionate about hemophilia and further advance that innovative progress. With a team that is solely dedicated to hemophilia, we will have the potential to transform the way hemophilia patients are treated.”

The spinoff plans to use its XTEN technology to develop longer-acting drugs into the clinic in the first half of 2017, as well as to push its development of bispecific antibodies and hemophilia-related gene therapies.

Eloctate and Alprolix created about $640 million in sales combined in the company’s last 12 months.

The subject of what to do with the hemophilia assets has been an issue since at least 2010, when Scangos took over the company. At that point, he considered divesting the hemophilia assets, because they “had no strategic ties to anything else were doing,” he indicated at the BIO CEO & Investors Conference in New York this February.

The hemophilia drugs didn’t have much to do with the company’s deep pipeline of neurologic compounds, but Scangos apparently kept them, because, as Xconomy reports, “they were less risky to develop than some other treatments and cheaper and quicker to test and get to market.”

The company continued to work in the hemophilia area, investing funds in a gene therapy treatment, but at the same February conference, Scangos said, “If all we were going to do was market those two compounds and let them run their life cycle, then we should probably just sell them, right? If we’re gonna be in it we need to be making investments for the future and the next generation of products, and care about this.”

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