October 7, 2015
By Alex Keown, BioSpace.com Breaking News Staff
YAVNE, Israel – Applied Genetic Technologies Corporation will not exercise its option to purchase its former subsidiary Andromeda Biotech from Hyperion Therapeutics and its parent company Horizon Pharma following the late-stage failure of the company’s experimental treatment for juvenile diabetes, Globes, an Israel-based business publication reported.
Clal Biotech had an option to purchase Andromeda for a price tag of $2.5 million to $36.5 million, depending on clinical trial outcomes. However, Andromeda’s Phase III trial for DiaPep277, a drug for the treatment of type 1 diabetes in juveniles, failed to achieve efficacy, Globes said. There is no indication yet if research will continue on the drug to see if it is a more effective diabetes treatment for other age groups.
Clal Biotechnology is a life-sciences holding company. Its main holdings include Gamida Cell Ltd., MediWound Ltd. and CureTech Ltd., Globes reported. Clal’s , traded on the Tel Aviv Stock Exchange, was down this morning. The stock was trading at 280.10 ILS (Israeli Shekels) down from a day’s high of 288.70 ILS.
Clal’s option to purchase Andromeda was part of an agreement with Hyperion the two companies entered into after a dispute over DiaPep277 stemming back to 2014. In April 2014, Hyperion acquired Andromeda from Clal for up to $570 million, but then scuttled trials for DiaPep277, arguing the drug’s data was not complete as it omitted results from 34 patients in violation of trial protocols. Clal sued Hyperion for $200 million, arguing that the company’s claims against them caused damage to the company’s reputation. The two companies negotiated a truce to complete trials for DiaPep277, giving Clal the option to repurchase Andromeda and the drug.
In 2007, DeveloGen AG sold all rights to DiaPep277 to Andromeda, which at the time was a subsidiary of Clal Biotechnology.
After Andromeda acquired the drug from DeveloGen, it c-o-developed the medication with Israel-based Teva Pharmaceutical Industries Ltd. until that company relinquished its rights to the drug in 2014, Globes reported. Teva financed most of the clinical trials surrounding DiaPep277, Globes said.
After the latest DiaPep277 drama, the drug is scheduled to revert to Yeda Research and Development Company, the place where it was originally discovered.
In May, Hyperion was acquired by Ireland-based Horizon Pharma for $1.1 billion. Hyperion’s pipeline included Ravicti and Buphenyl, both used for the treatment of urea cycle disorders. Buphenyl, also known as sodium phenylbutyrate, helps by removing nitrogen from the body. Ravicti, or glycerol phenylbutyrate, eliminates ammonia in patients over 24 hours. Urea cycle disorders and metabolic disorders impact more than 2,100 people in the U.S.
Earlier this year, Novo Nordisk pulled the plug on an expansion of Victoza (liraglutide) for use in type 1 diabetes after disappointing Phase III trial results. Victoza is a GLP-1 analogue used to treat type 2 diabetes. In the latest study, dubbed Adjunct One, Victoza (liraglutide) combined with an insulin improved blood glucose control in attempts to treat type 1 diabetes actually worsened episodes of low blood sugar, the company reported.
