The star of Monday’s deal is gusacitinib, a small-molecule drug that Formation is developing for chronic hand eczema. Sanofi will explore additional indications for gusacitinib in a Phase I study.
Sanofi has licensed gusacitinib, an oral JAK/SYK dual inhibitor from the “AI-native” drug development company Formation Bio, marking the pharma’s latest investment in AI-focused drug development.
Terms of the deal, announced Monday, were sparse. The licensing agreement will involve upfront and milestone payments worth up to €545 million, or approximately $632 million, though the companies did not provide a specific breakdown of these numbers. Formation’s subsidiary, Libertas Bio, which is in charge of the drug’s development, will also be eligible for sales royalties in the low-to-mid-teen range.
The asset at the heart of the deal, gusacitinib, is an investigational small-molecule drug that blocks the JAK and SYK proteins, both of which are involved in immune and inflammatory signaling cascades. Formation itself acquired gusacitinib from Asana BioSciences in November 2022—and formed Libertas to take charge of its development—and has since taken the asset to Phase III studies for chronic hand eczema.
According to Monday’s announcement, however, Sanofi will chart a new path for gusacitinib and “explore its potential in a new indication not previously studied,” for which the pharma will run a Phase I trial. The companies did not reveal what this new indication is.
Sanofi and Formation are long-time partners. In October 2022, the French pharma signed a three-year contract with Formation—named TrialSpark at the time—to leverage the biotech’s “tech-enabled drug development capabilities” to advance novel therapies in “areas of high unmet patient needs,” though the companies did not reveal which indications they specifically planned to target.
Then, in May last year, Sanofi and Formation together teamed up with OpenAI to develop “AI-powered software.” In that partnership, Sanofi is providing its collaborators with access to its proprietary data, while Formation contributes engineering resources. OpenAI brings its AI capabilities to the table.
Again, the companies at the time did not give much detail: They did not provide the financial terms of the deal, nor did they reveal priority disease areas.
In recent years, Sanofi has been investing heavily in its AI capabilities. In 2022, for instance, the pharma opened an AI Center of Excellence in Toronto to “identify, develop and scale innovative solutions,” as per a press announcement at the time. A few months later, the company signed a research collaboration with the BioMed X Institute in Germany to develop a computational platform that can predict the efficacy of drug candidates.
More recently, in April of this year, Sanofi put more than $1.8 billion on the line, including a $125 million upfront commitment, in an AI-focused partnership with biologics specialist Earendil Labs. The companies will focus on advancing two bispecific antibodies for immunology indications.
