Deal includes up to another $12.5 million in development funding and $69.9 million acquisition price.
ViroPharma has paid Meritage Pharma $7.5 million up front to secure an exclusive option to buy the firm outright and acquire its oral budesonide suspension (OBS) candidate, which is in Phase II development for the treatment of eosinophilic esophagitis (EoE). Under terms of the deal ViroPharma will provide Meritage with funding of up to another $12.5 million for the development and exclusive right to purchase the company at predefined terms, dependent on specific clinical and regulatory deliverables.
Meritage will use the initial funding to carry out additional Phase II studies with OBS. Once ViroPharma has received the Phase II data and an agreement has been reached with FDA on a clinical endpoint for the Phase III program, the firm will have an option to acquire Meritage for $69.9 million plus the potential for additional payments upon the achievement of certain clinical and regulatory milestones. OBS has been granted orphan drug designation by the U.S. regulatory authorities.
“Our interest in Meritage is consistent with ViroPharma’s intent to broaden our portfolio of development opportunities for rare and serious unmet medical needs,” remarks Vincent Milano, president and CEO. “Eosinophilic esophagitis is an emerging, rare condition that currently has no approved therapy.”
The completed, dose-ranging Phase II study evaluating OBS in pediatric patients with EoE involved 82 patients, 71 of whom completed therapy. Analyses of the compound primary endpoint of histologic response and reduction in clinical symptoms showed a statistically significant response on the histological component in the medium- and high-dose OBS groups, compared with placebo. However, the firm admits, while most of the children treated in the PEER study felt better, the multidomain symptom scoring tool used in the study was not sensitive enough to separate OBS and placebo treatment responses.