Kyowa Kirin, the Tokyo-based global specialty pharma, derives half its revenue from Japan. But sizeable sales gains by two of its three marketed drugs and recent progress in its pipeline has the company looking to North America as a new driver for global growth over the next four years.
“We project that we’ll be the fastest growing region from a revenue standpoint, and we’ll be the largest revenue producer of any of the regions by 2025,” Gary Zieziula, Kyowa Kirin’s president & region head, North America, told GEN Edge. “It’s really very promising for where the business is and where it’s going in North America.”
Kyowa Kirin finished 2020 with ¥59.9 billion ($543 million) in North American revenue, up about 54% from ¥39 billion ($354 million) a year earlier. North America’s share of Kyowa Kirin’s total revenue jumped last year to 19% from 13%, surpassing Europe-Middle-East-Africa (EMEA) to become Kyowa Kirin’s second largest region for revenue after Japan. There, Kyowa Kirin generated ¥159.9 billion ($1.45 billion), accounting for half of its total ¥318 billion (about $2.9 billion) in global consolidated revenue.
U.S. growth for Kyowa Kirin has been driven by its three marketed drugs. Crysvita® (burosumab-twza), co-developed with Ultragenyx Pharmaceutical and launched in 2018, saw sales jump 69% in 2020 to ¥42.4 billion ($384 million) from ¥25.1 billion ($227 million) a year earlier—in part due to approval of a second indication last summer, a form of fibroblast growth factor 23 (FGF23)–related hypophosphatemia in tumor-induced osteomalacia (TIO), added to the original approved use for the rare inherited disease X-linked hypophosphatemia (XLH).
The Parkinson’s disease treatment Nourianz® (istradefylline), launched in October 2019 and indicated for “off” episodes along with levodopa and carbidopa, enjoyed a 26-fold year-over-year sales leap from ¥100 million (just under $906,000) to ¥2.6 billion ($23.5 million) last year.
Kyowa Kirin’s third approved U.S. drug, Poteligeo® (mogamulizumab-kpkc)—indicated for relapsed or refractory mycosis fungoides or Sézary syndrome in adults with one prior systemic therapy—saw its sales rose 6.5% to ¥11.5 billion ($104 million) from ¥10.8 billion ($97.8 million). The increase is slower than for Kyowa Kirin’s two other U.S.-marketed drugs, attributed to delayed cancer treatment by patients resulting from the pandemic.
The sales momentum mostly continued in the first quarter of this year, which saw Kyowa Kirin’s total North American revenue rise 20% from Q1 2020, to ¥15.9 billion ($144.2 million) from ¥13.2 billion ($119.7 million). That increase reflected sales jumps of 28% for Crysvita, which rose to ¥11.7 billion ($106 million) from ¥9.2 billion ($83.4 million); and 168% for Nourianz, which more than doubled to ¥1 billion ($9 million) from ¥0.4 billion ($3.6 million).
Sales of Poteligio, however, dipped 10% year-over-year, to ¥2.6 billion ($23.5 million) from ¥2.9 billion ($26.3 million) in Q1 2020.
From $25M to $500M+
Three years ago, Kyowa Kirin’s North American revenue was about $25 million. “This year, we’ll do well over half a billion [dollars], driven by the global three brands and a couple of legacy brands,” Zieziula said. “We have grown tremendously.”
The company’s growth prospects were enhanced in April, when Kyowa Kirin streamlined its discovery, development, and commercial functions in North America. The company simplified its business structure, merging its Kyowa Kirin Research and Kyowa Kirin Development companies into Kyowa Kirin North America.
The North American operation consists of three sites and field teams covering all 50 U.S. states. The company oversees commercial functions from Bedminster, NJ; manages clinical development, operations, and corporate functions from Princeton, NJ; and carries out drug discovery research in La Jolla, CA.
The North American workforce has grown by 100 over the past year, nearing about 400 today (a significant jump from the 348 listed as of the end of 2020 in the firm’s annual report). They account for less than 10% of Kyowa Kirin’s total 5,400 employees worldwide.
The La Jolla site—one of Kyowa Kirin’s five research facilities worldwide—focuses on studying first-in-class therapeutics in immune-mediated disorders through translational research and open innovation. Immunology and allergy make up one of Kyowa Kirin’s four therapeutic areas of interest; the others are nephrology, oncology, and the central nervous system.
The La Jolla research site was behind the discovery of Crystiva; CERC-002, an anti-LIGHT antibody being developed by partner Cerecor, and other pipeline candidates that include the Phase III-bound KHK4083, a potentially first-in-class treatment for atopic dermatitis.
Last month, Amgen agreed to partner with Kyowa Kirin to co-develop and co-commercialize KHK4083, through an up-to-$1.2 billion collaboration that could also expand development of the drug into other autoimmune and inflammatory diseases, tapping into data generated by Amgen’s deCODE Genetics subsidiary.
“The atopic dermatitis indication represents about a $12-billion category in the United States. If we’re successful in getting our fair share of the market, it can really move Kyowa Kirin to the next level as a company focused on specialty medicines,” Zieziula predicted.
The company also cites 2019 data from Decision Resources estimating that atopic dermatitis affects 26 million patients in North America, the European Union, and Japan.
Amgen and Kyowa Kirin hope to challenge the top-selling drug for atopic dermatitis, the most common type of eczema—Dupixent® (dupilumab) co-marketed by Sanofi and Regeneron Pharmaceuticals. Those companies equally split profits and losses from U.S. sales of the blockbuster drug, while sharing profits outside the United States on a sliding scale, with both Regeneron and Sanofi reporting more than $4 billion apiece.
Through its Kymab subsidiary, which it acquired for up to $1.45 billion in a deal completed on April 9, Sanofi now holds full global rights to another atopic dermatitis drug that last year generated positive Phase IIa results, KY1005.
Michael J. Yee, equity analyst with Jefferies, told investors earlier this month that Kyowa Kirin expects to present data on KHK4083 in October that will show the efficacy of infrequent dosing.
“New Kyowa Kirin atopic dermatitis asset looks differentiated on mechanism and dosing,” Yee observed in a research note. “Importantly, the drug is Phase III ready, differentiated OX40 antibody, and could potentially be dosed as infrequently as 4–5 months after the initial series of loading doses.
“It seems strong competitively given it’s an antibody like Dupixent but improved dosing profile,” Yee added.
Another potential competitor to Kyowa Kirin and Amgen in atopic dermatitis is Connect Biopharma, whose lead candidate CBP-201 is, like Dupixent, a monoclonal antibody targeting interleukin-4 receptor alpha (IL-4Rα).
“We assign a 55% probability of success for CBP-201 in AD, with an initial U.S. launch in late 2025 and an ex-U.S. launch in 2026. We model ~$1.9B in peak sales by 2035,” Thomas J. Smith, director, immunology and metabolism and a senior research analyst with SVB Leerink, projected in a research note April 13. “CBP-201 binds to a different epitope of IL-4Rα than dupilumab, and while CNTB has not disclosed the specific binding region for CBP-201, early clinical data support the potential for differentiation vs. dupilumab.”
Kyowa Kirin envisions KHK4083 winning regulatory approvals in North America, Europe, and Japan in 2025 or 2026, with global Phase III trials for KHK4083 set to launch in the first half of 2022.
KHK4083 was discovered about two decades ago by Kyowa Kirin’s team of researchers in La Jolla, a group of productive drug hunters that has grown to about 40.
“Back in the early 2000s, a team inspired by a research proposal from the La Jolla Institute for Immunology was put together here to identify an antibody that had the properties of blocking OX40 binding to the OX40 ligand,” recalled Andrew J. McKnight, PhD, Kyowa Kirin’s chief research officer and head of open innovation in the United States.
OX40, he explained, was well sought after as a target within immunology and allergy treatments since it is only expressed on T cells when they’re activated. In the lesions of the patients there are OX40 positive T cells orchestrating the inflammatory immune response, which is dysregulated in those patients and other autoimmune patients.
“The OX40 molecule was almost a biomarker here, because when we know the OX40 is upregulated, we know that the patients are having a response to their own tissue antigens leading to the atopic dermatitis, for example,” McKnight said.
Kyowa Kirin researchers showed KHK4083 could block the signal that T cells require for survival and expansion into memory and defector cells, McKnight said.
The KHK4083 monoclonal antibody was then engineered with the company’s Potelligent® defucosylation technology platform, designed to enhance its antibody dependent cellular cytotoxicity (ADCC) activity. By creating 100% fucose-free monoclonal antibodies, McKnight added, Potelligent also increases binding affinity to a key Fc-gamma receptor on NK cells to potently enhance ADCC mediated depletion of OX40 expressing T cells.
Potelligent is one of three tech platforms licensed to biopharmas worldwide through Kyowa Kirin’s wholly owned BioWa subsidiary. Another is Complegent®, designed to enhance complement-dependent cytotoxicity (CDC) of therapeutic antibodies. The third, AccretaMab®, creates enhanced antibodies with both ADCC and CDC by using both Potelligent and Complegent.
Amgen agreed to partner on KHK4083 some three months after Kyowa Kirin said the antibody met its primary endpoint in a global Phase II trial (NCT03703102) of 274 patients with moderate to severe atopic dermatitis by showinga significantly larger percent change in Eczema Area and Severity Index (EASI) score 16 weeks after treatment compared with placebo. The company offered no data, however, saying that full results will be presented in future conferences and publications.
Kyowa Kirin’s collaboration with Amgen will revive a partnership that led to a joint venture between the California biotech giant and Kyowa Kirin’s corporate parent, Kirin Holdings. The companies’ joint venture lasted more than three decades before ending in 2017. That year, the joint venture became a wholly owned Amgen subsidiary, with Kyowa Kirin in-licensing some Amgen drugs in the Asia-Pacific region.
The joint venture was formed in 1984 to develop and commercialize EPOGEN® (sold in Japan as ESPO®), which in 1989, became the first Amgen drug approved in the United States, and a year later became the first Kyowa Kirin treatment approved in Japan. Over time, the joint venture expanded to include the development and commercialization of several other medicines, including Neupogen® (GRAN® in Japan), Neulasta® (G-Lasta® in Japan), Aranesp® (NESP® in Japan), and Nplate® (Romiplate® in Japan).
Asked if the new partnership with Amgen was inevitable given the past relationship between the companies, Zieziula replied, “I would say the past relationship along with their inflammatory disease expertise certainly helped in our decision-making process.”
A week after announcing the Amgen partnership on June 7 Kyowa Kirin joined San Diego-based MEI Pharma in dosing the first patient with relapsed or refractory marginal zone lymphoma in a recently added second arm of the global Phase II TIDAL trial (NCT03768505; Trials of PI3K DeltA in Non-Hodgkin’s Lymphoma) assessing zandelisib (formerly ME-401), a selective phosphatidylinositol 3-kinase delta inhibitor, as a monotherapy to potentially treat adults with follicular and marginal zone lymphomas.
Kyowa Kirin and MEI Pharma are developing zandelisib as an oral, once-daily, treatment for patients with B-cell malignancies. The company initially envisions marketing zandelisib for follicular lymphoma in later line use, to be followed by an earlier line use indication, Zieziula said. Last year, the FDA granted its fast-track designation to zandelisib for treatment of adult patients with relapsed or refractory follicular lymphoma who have received at least two prior systemic therapies.
Zandelisib and KHK4083 are two of three pipeline candidates or “next-generation global strategic products” that Kyowa Kirin is counting on to reach the market and generate sales over the next five years.
The third is KW-6356, a next-generation version of Nourianz that Kyowa Kirin said last year succeeded in a 502-participant Phase IIb trial (NCT03703570) by showing a statistically significant change from baseline in movement disorder society-unified Parkinson’s disease rating scale (MDS-UPDRS) part III (motor symptoms) score compared to placebo over 26 weeks. Again, Kyowa Kirin released no detailed data, saying that would come in future conferences or published studies.
In La Jolla, Kyowa Kirin not only carries out both in-house and collaborative research with other partners like MEI, but also partners on research with the La Jolla Institute for Immunology, through a three-decade-old alliance—the longest academic-industry collaboration, according to the partners.
As head of the U.S. Open Innovation Group, McKnight oversees Kyowa Kirin’s growing pursuit of external research collaboration opportunities in early stages, especially on novel target finding, discovery-to-preclinical stage drug candidates, and innovative technologies for accelerating drug development. He said Kyowa Kirin seeks a balance between those external efforts and in-house R&D.
“We have a number of individuals who are going out, looking to partner with other academic institutions. We have collaborations on going with UCSD [University of California, San Diego] locally. We also have discussions ongoing with smaller biotechs in the Boston area in particular, where we might look to partner with those early ideas, either out of academia or out of the biotech sector,” McKnight said.
“Very early-stage opportunities are what we’re looking for rather than someone coming to me and saying ‘Here’s my lead candidate, it’s IND ready… where’re the patients?’ We’re really looking to identify and develop valuable assets at an earlier stage than that,” McKnight explained. “My team, the Open Innovation Group, is trying to find early seed opportunities and technology partners we can collaborate and partner with through drug discovery efforts.”