In another sign that biotechnology companies with promising pipelines are able to forge rich buyout deals, Japanese pharmaceutical company Daiichi Sankyo has announced it will pay $805 million upfront and up to $130 million in near-term milestones for Plexxikon, a tiny oncology developer, according to Fierce Biotech.
For Daiichi the deal offers a potential shortcut into the oncology market. The Berkeley, Calif.-based biotech's lead program, PLX4032, an oral drug that targets the oncogenic BRAF mutation present in about half of melanoma cancers, could be approved as early as next year. And Plexxikon retained co-promotion rights in the U.S. when it arranged its licensing deal with Roche.
A small biotech with only 45 employees, Plexxikon will now operate as a separate unit of Daiichi, with its staffers concentrating on filing for regulatory approval on PLX4032 later this year. Plexxikon also has early-stage programs underway for breast cancer and rheumatoid arthritis.
Plexxikon needed only $67 million in venture funds over nine years and relied heavily on major partnerships to fuel its work. In an interview with FierceBiotech, CEO Peter Hirth said the new game plan will be to continue on much as before, with a goal of producing one new IND a year, all while pushing ahead with its eight current programs.
"Daiichi Sankyo really liked the way we go about doing business," said Hirth. "They are supplying a budget to us, similar to the one we had for the last two years. We will be making our own decisions, staying independent as we have been, making decisions on our own." And Daiichi Sankyo can step in after phase II and continue late-stage development work, leaving Plexxikon to do what it does best.
Last August researchers announced that nearly all melanoma patients enrolled in a clinical trial of PLX4032 demonstrated some response; 81% had tumor shrinkage of at least 30%. That led the University of Pennsylvania's Lynn Schuchter to tell USA Today that "this is the most important breakthrough in melanoma, ever."