In Glaxo Sierra’s momelotinib finds its fifth owner

Investors bemoaning the state of the public biotech markets today have reason for optimism. Glaxosmithkline’s $1.9bn takeover of Sierra Oncology shows that if a target with positive pivotal data meets a company with a pipeline problem a deal will happen. Thus, as Evaluate Vantage had suggested at the time, as soon as Sierra’s momelotinib scored in the phase 3 Momentum study a takeover was possible. The data were impressive, but anyone today suggesting that Glaxo is overpaying ($1.9bn represents a 39% premium) will point to two facts: momelotinib targets a niche indication, myelofibrosis patients in whom anaemia is the main co-morbidity, and it has limited IP protection. SEC filings cite composition patents as expiring in 2028-30, though a salt form is apparently covered until 2035. Momelotinib has a long history, and Glaxo is its fifth owner, after Cytopia, YM Biosciences, Gilead and Sierra. One person who will today be celebrating is Nick Glover, Sierra’s former chief exec; Mr Glover had sold YM to Gilead before reacquiring momelotinib, and while he no longer runs Sierra the appreciation in any stock he still holds in his former company will confirm him as having lived the biotech dream.

Turning $14m (via $510m and $3m) into $1.9bn: a history of momelotinib
Date Deal Terms
Mar 2008 Cytopia selects CTY387 as the preclinical lead in a series of Jak2 inhibitors it originated N/A
Oct 2009 YM buys Cytopia (CYT387 is still in preclinical development) $14m all-stock deal
Dec 2012 YM reports positive ph1/2 data for CYT387 (now said to be a Jak1/2 inhibitor) at Ash N/A
Dec 2012 Gilead buys YM (CYT387 is the lead asset) $510m in cash
Nov 2016 CYT387 (now called momelotinib) fails the ph3 Simplify-1 and 2 studies in myelofibrosis N/A
Aug 2018 Sierra buys momelotinib (now said to be a Jak1/2 and ACVR1 inhibitor) from Gilead $3m cash up front, up to $195m in milestones, plus tiered royalties (mid teens to high 20s)
Jan 2022 Momelotinib succeeds in ph3 Momentum study in post-Jakafi myelofibrosis N/A
Apr 2022 Glaxosmithkline buys Sierra (momelotinib is the lead asset)  $1.9bn in cash
Source: company announcements.

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