The funding comes weeks after TL1A blocker duvakitug maintained clinical remission rates above 50% in patients with ulcerative colitis and Crohn’s disease in a Phase 2b trial.
Teva has secured $400 million in funding from private equity firm Blackstone Life Sciences to help drive the development of duvakitug, a Sanofi-partnered TL1A blocker being trialed for inflammatory bowel diseases. The deal adds to an emerging trend of private equity firms buying into biopharma.
Blackstone will disburse the funding across four years and will be eligible for regulatory and undisclosed commercial milestones associated with duvakitug, according to Teva’s news release on Tuesday.
Blackstone will also be entitled to receive low single-digit royalties on drug sales worldwide.
Duvakitug is a monoclonal antibody that works by blocking the TL1A cytokine, in turn dampening the inflammatory response while also reducing fibrosis. In October 2023, duvakitug’s therapeutic potential attracted a $500 million upfront investment from Sanofi, which gained co-development and co-commercialization rights over the drug. Sanofi also promised up to $1 billion in development and launch milestones.
Last month, Teva released data from the Phase 2b RELIEVE UCCD LTE study, demonstrating the durability of the drug’s benefits. After 14 weeks of induction treatment and 44 weeks of maintenance with 900-mg duvakitug, 58% of patients with ulcerative colitis and and 55% of patients with Crohn’s disease remained in clinical remission.
As part of the 2023 contract, Sanofi will take charge of duvakitug’s clinical development once it reaches Phase 3. The pharma has since launched the late-stage STARSCAPE-1 study in Crohn’s disease and SUNSCAPE-1 trial in ulcerative colitis. The former is expected to complete in 2029 while the latter will wrap up in 2028.
Tuesday’s Blackstone deal plays into what PitchBook Senior Biotech Analyst Kazi Helal called the “PE-ization of pharma” in an interview with BioSpace last July. Private equity firms have previously steered clear of the pharma industry because of the binary risk that drug development carries.
But the recent unforgiving market conditions have left biopharma companies eager for any available funding, creating an opportunity for private equity firms to invest and potentially reap the rewards if a drug candidate makes it to the market or is sold off. “A lot of these folks are seeing opportunity now in biotech and distressed assets, and it’s hard to pass off,” Helal told BioSpace.
In February last year, bluebird bio, which at the time had struggled to keep its finances afloat, announced that it would go private in an acquisition deal with global investment firms Carlyle and SK Capital Partners. All told, the arrangement valued bluebird at roughly $50 million.
A few months later, in June, Lexeo Therapeutics continued the “PE-ization” trend, inking a $40 million financing agreement with Perceptive Xontogeny Venture Funds and venBio Partners, with an eye toward spinning out a new entity focused on developing treatments for cardiac genetic diseases.
