Investor reaction to the deal was muted, with BMO Capital Markets analysts saying they “continue to look for more” from Bristol Myers Squibb before they can “get excited about the near term turnaround story.”
Bristol Myers Squibb added fuel to a busy few weeks in cell therapy with a $1.5 billion takeover of Orbital Therapeutics.
The acquisition will give BMS the biotech’s RNA therapies that work by reprogramming cells of the immune system in vivo. This includes Orbital’s lead asset, OTX-201, a circular RNA therapy that makes use of the patient’s own cells to produce CD19-targeting CAR constructs, according to the biotech’s website. OTX-201 is being tested for B cell-driven autoimmune disorders and is designed to deplete these disease-causing cells and reset the immune system.
BMS will also gain ownership of Orbital’s RNA platform, which uses an AI-driven design approach to produce circular and linear RNA therapies for “a broad spectrum of diseases,” according to Friday’s release. On its website, Orbital notes that aside from autoimmune conditions, its technology can be used to target cancers, as well as produce next-generation RNA vaccines and protein therapies.
The reaction to the deal from analysts at BMO Capital Markets was muted. “We continue to look for more from the company before we can get excited about the near term turnaround story,” they wrote in a Friday morning note.
“Cell therapy in autoimmune disease is interesting in the clear magnitude of benefit that patients receive from treatment. But the therapeutic burden and logistical challenges of administering these treatments to patients will likely limit use to only those in the most severe patient populations,” BMO continued. “We remain skeptical of broader use with other options available to patients.”
The companies did not provide a detailed financial breakdown of the acquisition, only disclosing that BMS plans to pay Orbital, a private comapny, the $1.5-billion fee in cash once the deal closes. They likewise did not specify when they expect to complete the transaction.
“In vivo CAR T represents a novel treatment approach that could redefine how we treat autoimmune diseases,” Robert Plenge, chief research officer at BMS, said in a statement. Orbital’s technology “enhances our robust cell therapy research platform” while also giving the pharma a “potential best-in-class therapy” that can reset the immune system to treat autoimmune diseases.
BMS also expects the Orbital acquisition to present an “incredible opportunity to make CAR T-cell therapy more efficient and accessible to more patients,” Lynelle Hoch, president at the pharma’s Cell Therapy Organization, added. BMS is currently the only pharma player with two approved CAR T therapies against two different targets: the anti-BCMA Abecma, indicated for relapsed or refractory multiple myeloma, and the CD19-directed Breyanzi, approved for several blood cancers, including mantle cell lymphoma and follicular lymphoma.
Friday’s acquisition agreement comes just days after Takeda announced it would abandon all cell therapy work—a move that left 137 of its employees jobless. Before its cell therapy exit, Takeda had made several notable investments in the field, including the acquisitions of GammaDelta in October 2021 and Adaptate Biotherapeutics in January 2022.
The cell therapy space also appears to be enjoying a regulatory tailwind after the FDA last month released a slew of draft guidelines outlining recommendations to help companies improve the efficiency of their drug development.
