While other developers of galectin-3 inhibitors hitched their horses to the NASH bandwagon, Galecto Biotech pushed forward with work in idiopathic pulmonary fibrosis (IPF). For this, it has been rewarded with a potentially substantial takeout by Bristol-Myers Squibb, which could total $444m.
This implies a healthy valuation for a company that has only just moved into phase I and raised a mere €10m ($12.6m) to date. But with recent US approvals of the first disease-modifying agents for IPF and Roche’s swoop into this space, this market can now be considered big pharma territory. While the potential of the numerous liver fibrosis projects in development remains opaque, Galecto was wise to focus on a more tangible target (see table below).
The private, Denmark-based company is one of three dominant drug developers working with galectins, a group of proteins that have been shown to be involved in many disease processes.
Galectin-3 has emerged as the dominant target for research owing to its role in the development of fibrosis. It is known to promote myofibroblast activation and collagen synthesis; according to Galecto, mice deficient in galectin-3 develop much less severe liver, renal and pulmonary fibrosis. Alongside Galecto, La Jolla and Galectin Therapeutics have also moved galectin-3 inhibitors into the clinic.
|The galectin-3 pipeline|
|Phase II||GCS-100||Injection||La Jolla Pharmaceutical||CKD; CLL|
|Phase I||TD139||Inhaled||Galecto Biotech||IPF|
|GR-MD-02||Injection||Galectin Therapeutics||NASH; Melanoma|
|Pre-clinical||LJPC-101||Subcutaneous||La Jolla Pharmaceutical||Liver fibrosis|
|LJPC-201||-||La Jolla Pharmaceutical||Liver fibrosis|
|LJPC-1010||Oral||La Jolla Pharmaceutical||NASH; NAFLD|
|GM-CT-02||-||Galectin Therapeutics||Liver fibrosis|
|GR-MD-01||-||Galectin Therapeutics||Liver fibrosis|
|Research project||Galectin-3 Inhibitor Research Program||Oral||Galectin Sciences*||Fibrosis; cancer|
|*A JV between Galectin Therapeutics and SBH Sciences to develop oral galectin-3 inhibitors|
La Jolla reported encouraging phase II data back in March for GCS-100, which it describes as a high molecular weight complex polysaccharide. The studies showed a significant improvement in kidney function, which the company put down to the project helping to reverse the tissue fibrosis that is a hallmark of the disease.
The group has an oral version as well as what it describes as a more potent form of this agent, LJPC-1010, in preclinical development. This is earmarked for a phase I nonalcoholic steatohepatitis – or NASH – trial in the first half of 2015.
Galectin Therapeutics, meanwhile, has gone straight for the NASH indication with GR-MD-02, which it says is a complex carbohydrate molecule derived from apple pectin material. It reported what it interpreted as encouraging phase I data earlier this year, although the shares fell 60% on the news and remain depressed. Presentation of data at the approaching AASLD conference will be watched with interest.
As well as its primary indication, Galecto's TD139 is differentiated from the other galectin-3 inhibitors in development by its inhaled delivery method. The company says it is a specific inhibitor of the galactoside-binding pocket of galectin-3. A phase I/IIa trial started last month in the UK, primarily looking at safety and tolerability but also measuring anti-fibrotic effects.
Right to buy
Under the deal agreed with Bristol-Myers, the pharma giant can exercise its option to buy Galecto at any time but no later than sixty days after completion of a phase Ib trial. The companies have agreed on preclinical studies and a phase I development plan that will be funded by BMS. Total aggregate payments have the potential to reach $444m, which includes an option fee, an option exercise fee and other milestones – any up-front sum has been kept under wraps.
Should TD139 ultimately succeed in IPF, the sales potential seen in Esbriet and Ofev show that this investment will have been worth it. Esbriet, now owned by Roche after the surprise $8.3bn takeout of Intermune earlier this year, and Boehringher Ingelheim’s Ofev, are both being launched in the US and forecast to be generating around $2bn in sales by 2020.
Meanwhile, companies pushing forward in NASH can point to little that is tangible. They and their proponents describe the disease as a significant unmet medical need; however, the market remains undefined and the regulatory path untested. It is notable that despite the billion-dollar valuations that are often touted, big pharma has remained largely on the sidelines.
Galecto’s chief executive, Hans Schambye, told EP Vantage that IPF was chosen as a lead indication based on preclinical data, but also because it is an orphan illness with a clear regulatory and clinical path, with considerable big pharma attention.
Small drug developers – in NASH and beyond – should take heed.