Lundbeck has agreed to acquire Abide Therapeutics for up to $400 million cash, the companies said today, in a deal designed to bolster the buyer’s drug discovery efforts and pipeline in one of its key therapeutic areas, neurology.
Through the acquisition, Lundbeck will add Abide’s discovery platform focused on discovering potent and selective serine hydrolase inhibitors. While they represent just 1% of all mammal proteins, Lundbeck noted, they play key roles in many pathophysiological processes, including blood clotting, digestion, nervous system signaling, inflammation, and cancer.
The chemo-proteomic platform may also be further expanded, Lundbeck added, in order to characterize other enzyme systems within the serine hydrolase family, and thus potentially develop additional active agents designed to modify enzyme function.
“The acquisition of Abide provides us with a differentiated chemo-proteomic platform to discover new classes of drugs for a broad spectrum of brain diseases starting with those that harness the therapeutic potential of the endocannabinoid system,” Lundbeck president and CEO Deborah Dunsire, MD, said in a statement. “Abide’s innovative R&D platform provides us with a unique opportunity to strengthen our pipeline now and well into the future, putting Lundbeck in position to deliver multiple new and transformative treatments for brain diseases.”
Abide’s lead candidate, ABX-1431 is a potent selective inhibitor of the serine hydrolase monoacylglycerol lipase (MGLL) that augments endocannabinoid signaling, with the goal of restoring homeostatic balance in the central nervous system.
Lundbeck reasons that ABX-1431 has the potential to address multiple indications in psychiatry and neurology. ABX-1431 is under initial development in clinical trials designed to assess its effectiveness—including an exploratory Phase IIa study (NCT03625453) as a first-of-its-kind treatment for Tourette syndrome, and a Phase I study (NCT03447756) in neuropathic pain.
Abide’s pipeline consists of inhibitors designed to target other serine hydrolases, which the company envisions as future novel treatments for neurological and/or psychiatric disorders. In addition to ABX-1431, Abide’s pipeline consists of five preclinical candidates. Two of them also target MGLL: ABX-1762, indicated for unspecified CNS disorders, and ABX-1626, whose indication is undisclosed.
The other three preclinical candidates have undisclosed targets: ABD-X, indicated for nonalcoholic steatohepatitis (NASH); ABD-Y, indicated for unspecified immunomodulatory disorders; and ABX-1772, whose indication has not been disclosed.
Rebuilding a pipeline
Lundbeck aims to rebuild a pipeline following a pair of clinical setbacks in recent months. In October 2018, a month after Dunsire took office, Lundbeck disclosed that its Lu AF35700 failed to show statistical superiority vs. conventional therapy in treatment-resistant schizophrenia in the drug’s first Phase III trial in October.
And in February, the company and partner Otsuka Pharmaceutical acknowledged that their brexpiprazole missed its primary endpoint of statistical separation from placebo in two Phase III trials assessing the drug as a treatment for manic episodes associated with bipolar I disorder.
“Lundbeck’s commitment to brain health convinced us that together this was the best way to attain Abide’s goal to develop novel therapeutics that make a fundamental difference in the lives of patients with a range of neurological and mood disorders,” added Alan Ezekowitz, CEO of Abide.
Abide was established in 2011 to commercialize the activity-based protein profiling (ABPP) assay technology developed by co-founder Benjamin Cravatt, PhD, and colleagues at Scripps Research, where he is a professor and the Gilula Chair of chemical biology. In October, Cravatt received a National Cancer Institute (NCI) Outstanding Investigator Award that will support his laboratory with $7.8 million over seven years.
Abide’s laboratory in La Jolla, CA, will become a U.S. drug discovery hub for Lundbeck upon closing of the acquisition, which is expected during the second quarter of this year, subject to customary regulatory approvals that include expiration or termination of the waiting period under the Hart-Scott-Rodino Act in the U.S.
Lundbeck agreed to pay $250 million upfront to Abide’s current investors, and up to $150 million in payments tied to achieving development and sales milestones. Lundbeck said it expects to fund the deal through existing cash reserves.
The acquisition transaction, Lundbeck said, will not have any impact on the financial guidance range it provided to investors in February. Lundbeck has projected 2019 revenue ranging from DKK 16.1 billion to DKK 16.7 billion ($2.4 billion to $2.5 billion). The company has also forecast earnings before interest and taxes (EBIT) of between DKK 4.2 billion and DKK 4.6 billion ($629.5 million and $689.5 million).
The expected operational costs related to Abide will be covered within the current guidance range for 2019, Lundbeck added.