Sanofi is signing 10 or so early-stage anti-infective projects over to Evotec, and oddly enough the up-front fee, in this case €60m ($74m), is going from the licensor to the licensee. The idea is that Sanofi pays Evotec to develop the products in the belief that the smaller group, being entirely focused on infectious disease, can do so more efficiently.
“Sanofi has the first right to opt in, but if they don’t take it someone else can,” Werner Lanthaler, Evotec’s chief executive, tells EP Vantage. The French big pharma group is working hard to shift its focus to cancer and blood disorders, so outsourcing its non-core R&D makes sense – but the winner of this deal looks to be Evotec.
The compounds themselves are shrouded in mystery: the most the partners have said is that some are antivirals and others antibiotics, with a focus on molecules with new mechanisms of action. The bacterial infections Evotec is prioritising include those caused by Acinetobacter baumannii, Pseudomonas aeruginosa and enterobacteriaceae, for which no new drug classes have emerged in over 40 years, as well as multidrug-resistant strains.
The anti-infectives will be incorporated into Evotec’s “open innovation platform”, which already plays host to compounds from academic sources and other biotech and pharma companies, including Haplogen and Forge Therapeutics.
The transaction is not technically done yet. Owing to a quirk of French labour laws, since it involves the transfer of 100 or so Sanofi staff at a facility in Lyons to Evotec, it will not close until mid-year. Mr Lanthaler says the two companies have finalised the agreement as far as they are able.
But antibiotics by their nature are short-term drugs, and much of the reason developing new ones has stalled is that they are rocky commercial prospects. “That’s the economic situation we currently look at, and that’s why pharma has a tendency to go for chronic [disorders where] patients never come off the drug,” Mr Lanthaler concedes.
“But it’s a massive medical need, and often here you can think of different ways of creating new financial models.” He suggests that new antibiotics might be stockpiled, like Tamiflu has been in the past, to hedge against outbreaks of infections caused by antibiotic-resistant bacteria.
Even so, drugs that are taken for a few months at most are hardly a reliable source of revenue – Gilead’s hepatitis C cures, for example, were wildly successful until they destroyed their own market base. Resistant bacterial infections will be harder to wipe out than hep C, but there is a reason why almost all of the biggest-ever selling drugs treat chronic diseases (The mega-blockbusters – biologicals dominate biopharma’s hall of fame, March 8, 2018).
Commercial concerns will not have to be confronted for a long time yet. The most advanced of Sanofi’s molecules is still only at the lead optimisation stage, and Mr Lanthaler says if clinical trials being within two years “that would be a fantastic success”.
Fantastic success seems to be what the company is banking on. It believes that it can take several compounds to the clinic despite their early, unproven nature, and might end up at the centre of a feeding frenzy.
Mr Lanthaler posits that three or four clinical-stage assets might simultaneously emerge from the programme and become available for licensing: “That’s not an unrealistic situation.” And at that point Evotec will be able to take advantage of licensing the compounds to other drug makers.
“It’s unlikely that one pharma company can pick up more than one or two phase III infectious disease drugs,” he says. “That’s why it becomes so much more efficient to not only work for one potential pipeline out there but for many pipelines – then the bottleneck of development money falls away.”
All Evotec has to do is develop a bunch of earlier-than-preclinical antibiotics with new modes of action – something that has eluded biopharma for decades – partner them, several at a time, with a wide range of pharma companies, and then turn them into money-spinners when they reach market, despite their short-term courses of treatment.
At least it will not have to pay out of its own pocket to do so – for now.