Janssen Cuts Ties with Theravance After IBD Program Flop

Janssen_Niels Wenstedt/BSR Agency/Getty Images

Niels Wenstedt/BSR Agency/Getty Images

J & J’s Janssen Pharmaceutical says goodbye to San Francisco’s Theravance Biopharma after a disappointing performance from a drug the two companies were developing together.  

Three years ago, the two entered into a collaboration for izencitinib, an oral, gut-selective JAK inhibitor with aspirations to treating ulcerative colitis and Crohn’s disease. Theravance scored $100 million in 2018, with another $900M potential on the line with milestone payments and royalties. Janssen has now opted to terminate the deal in the wake of recent events.  

This year has been a bit of a downward spiral for Theravance. In August, the biopharma announced the drug failed to make much of a difference over the placebo for ulcerative colitis patients. At all doses, izencitinib did not show any notable changes in lab values, including creatine phosphokinase and lipids. The only benefit the treatment provided was a reduction in rectal bleeding. 

Then in November, after a failed Phase III cardiac drug, Theravance announced a termination of 75% of its staff, a headcount of 270 employees let go. The layoff was framed as part of a new strategic action plan for the company, saving the company $165 million in the process and allowing a refocus on respiratory disease.  

Theravance has already helped bring two respiratory focused drugs to the market – Yuperli and Trelegy for COPD. These two provide income for Theravance, but not nearly enough to offset expenses. During the first half of 2021, $21.2 million was recorded as collaboration revenue. Company expenses, mainly related to R&D, clocked in at $175 million.  

Two more fully-owned candidates are in the pipeline for respiratory disease. An inhaled JAK inhibitor for acute and chronic lung inflammation is in Phase II studies, while another is in Phase I for asthma.  

The day after the staff cut became public, the company announced it was discontinuing its Phase II study of izencitinib for Crohn’s disease as well. After reviewing trial data, it was determined that, while safe, the drug didn’t hold much promise for efficacy.  

With the end of both studies for izencitinib, the termination decision by Janssen just makes sense. Year to date, the stock price for Theravance has taken a tumble of close to 40% down. In the wake of the deal termination, it’s poised for another dip.  

Inflammatory bowel disease affects a growing number of Americans with a tally of approximately 3 million diagnosed with either Crohn’s disease or ulcerative colitis. AbbVie’s Humira has been a miracle drug for many, finally easing the symptoms and offering hope for a more normal life. Sales of Humira for 2020 tallied in around $20 billion, $16 million in the US alone, making it the top selling drug of the year.  

The drug now faces some competition in the global market as biosimilars gain approval. Coherus BioSciences Humira biosimilar Yusimry was FDA approved just this week. Yusimry won’t hit the US market until July 2023, along with Samsung Bioepis’ Hadlima, Sandoz’s Hyrimoz, and Boehringer Ingelheim’s Cyltezo.  

So as Theravance bows out of the IBD market, many others will fill the gap for the growing need.   

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