SAN FRANCISCO — Incyte’s success with Jakafi® (ruxolitinib) has helped persuade MorphoSys that its tafasitamab (MOR208) could also be successfully commercialized by the Wilmington, DE, biopharma, which is licensing the B-cell malignancy candidate through a collaboration that could generate more than $2 billion for the German cancer drug developer.

MorphoSys and Incyte say they will co-commercialize tafasitamab in the U.S., with Incyte holding exclusive commercialization rights in other countries. It’s a different situation than Jakafi, where Incyte holds U.S. rights to the JAK1/JAK2 inhibitor while foreign rights are held by Novartis.

MorphoSys CEO Jean-Paul Kress, MD, told GEN Edge that Incyte was one of more than 20 biopharmas that expressed interest in partnering with his company to develop tafasitamab, during a process that took four to five months.

One key factor that tipped the scales, Kress said, was Incyte’s skill in bringing Jakafi to the U.S. market, and keeping its stateside blockbuster revenues growing. Twice in 2019, Incyte raised its guidance to investors on full-year 2019 net product revenues for Jakafi—most recently to a range around $1.65 billion, which would be 20% above 2018 revenues.

Jakafi generated $1.2 billion in net product revenues in the first nine months of 2019, up 20% year-over-year from $1.0 billion—including $433 million in the third quarter, up 25% from a year ago—on top of $1.4 billion in 2018 revenues, up 22% from 2017.

“Their track record in the U.S. especially with the launch of Jakafi has been extremely impressive,” Kress told GEN Edge at the J.P. Morgan 38th Healthcare Conference in San Francisco. “I think the commercial uptake of Jakafi has been remarkable in the U.S. If we can do the same kind of trajectory, all being equal—it’s not the same market—I’ll be very happy. That was a big part of the decision.”

Other factors that made Incyte attractive, Kress added, were Incyte’s other marketed drug Iclusig® (ponatinib), which generated $65.6 million in Q1–Q3 2019, up 8% from $60.8 million a year earlier; Incyte’s “very strong” ex-U.S. medical affairs teams, which interact with hemo-oncology specialists in 11 European countries and Japan; and Incyte’s acceptance of MorphoSys leading key aspects of the partnership.

“We see our asset fitting their (Incyte’s) ex-U.S. operation very nicely,” Kress added.

Taking the lead

MorphoSys will lead the clinical development and commercialization strategy and book all revenues from sales of tafasitamab. Incyte and MorphoSys will be jointly responsible for commercialization activities in the U.S. and will share profits and losses 50:50. Outside the U.S., Incyte will have exclusive commercialization rights, lead the commercialization strategy, and book all revenues from sales of tafasitamab, agreeing to pay MorphoSys royalties on ex-U.S. net sales.

The companies also agreed to share development costs associated with global and U.S.-specific trials, with Incyte receiving 55% and MorphoSys. Incyte will also cover 100% of future development costs for trials that are specific to ex-U.S. countries.

“This is why we chose them: We are strong in development. We don’t really need desperately another company to help us with lack of capacity or something like that. [Incyte] will not impose on us by saying things like, ‘Hey we don’t believe in this indication, we don’t want to follow you,’” Kress said. “We also stay in the lead for our major coming indications, and we just tap into their network, their know-how and their resources to help us.”

MorphoSys started thinking about a partnership for tafasitamab before Kress became CEO last September, though he put into place the strategic approach of the Incyte deal: A global partnership with a US 50-50 share. Kress succeeded Simon Moroney, PhD, who stepped down after 27 years at the company’s helm.

Tafasitamab is a humanized Fc-engineered monoclonal antibody candidate directed against CD19. Tafasitamab incorporates an XmAb® engineered Fc domain, which is intended to lead to a significant potentiation of antibody-dependent cell-mediated cytotoxicity and antibody-dependent cellular phagocytosis, thus aiming to improve a key mechanism of tumor cell killing.

MorphoSys is assessing tafasitamab in a number of ongoing combination clinical trials, as a therapeutic option in B cell malignancies.

On December 30, 2019, MorphoSys said it submitted a BLA for tafasitamab in combination with lenalidomide to the FDA, seeking approval as a treatment for relapsed or refractory diffuse large B cell lymphoma (r/r DLBCL). The FDA is expected to decide on the BLA by mid-2020, which is about when the European Medicines Agency (EMA) is expected to receive a Marketing Authorization Application (MAA) for tafasitamab in r/r DLBCL.

The BLA submission was based on positive data from the Phase II L-MIND trial of tafasitamab with lenalidomide in patients with r/r DLBCL. The trial compared real-world response data of patients with r/r DLBCL who received lenalidomide monotherapy with the efficacy outcomes of patients treated with the tafasitamab-lenalidomide combination.

Expanding U.S. presence

The prospect of FDA approval followed by commercialization of tafasitamab later this year has prompted Planegg/Munich, Germany-based MorphoSys to expand its U.S. presence. In November, the company opened a new U.S. headquarters in Boston, with regional sales managers hired and a team of medical science liaisons under way to achieving its goal of 2,000 engagements with key opinion leaders by the time of the planned launch.

Close to 70 employees are based at MorphoSys’ Boston office.

“With the sales force, we’ll have a U.S. team of around 150 people” by the time of the expected tafasitamab launch, Kress said. “That’s in line with our strong desire to be a U.S.-focused organization. We have all the key positions staffed with great experienced oncology leaders.”

In December, MorphoSys dosed its first patient in a Phase IB trial assessing tafasitamab in first-line DLBCL. The trial is an open-label, randomized, multicenter study designed to assess safety and preliminary efficacy of tafasitamab in addition to R-CHOP (rituximab, cyclophosphamide, doxorubicin, vincristin, prednison) as well as the combo of tafasitamab and Celgene’s Revlimid® (lenalidomide) plus R-CHOP in adults with newly diagnosed, previously untreated DLBCL.

The Phase IB trial’s primary endpoint is the incidence and severity of treatment-emergent adverse events. Data from the study is expected to emerge in mid-2020. “The goal is to start the pivotal trial and dose the first patient in early 2021,” Kress said.

Incyte and MorphoSys agreed to co-develop tafasitamab broadly in r/r DLBCL as well as frontline DLBCL and indications beyond DLBCL, such as follicular lymphoma, marginal zone lymphoma, and chronic lymphocytic leukemia.

Incyte agreed to pay MorphoSys $750 million upfront, and invest $150 million in new American Depositary Shares (ADS) of MorphoSys at a premium to the share price at signing of the agreement. Incyte also agreed to pay MorphoSys up to $1.1 billion in payments tied to achieving developmental, regulatory, and commercial milestones.

The upfront cash and equity investment, Kress said, will bring MorphoSys to more than $1 billion in cash and short-term investments, enough capital to fund tafasitamab’s clinical program: “One of the main goals of the deal is to be financially independent for several years.”

In addition, MorphoSys will also receive tiered royalties from Incyte on ex-U.S. net sales of tafasitamab at a percentage range of net sales ranging from the mid-teens to mid-twenties.

The collaboration and licensing agreement, including the equity investment, is subject to clearance by U.S. antitrust regulators under the Hart-Scott-Rodino Act, as well as by German and Austrian antitrust authorities. The agreement will become effective as soon as these conditions have been met, MorphoSys and Incyte said.

Previous articleExosome Therapy for Stroke Produces Full Recovery in Animal Model
Next articleCell Division Finding May Lead to New Therapies for Preventing Cancer Growth