Allergan’s acquisition spree continued on Tuesday with the announcement it bought Tobira Therapeutics in a deal worth up to $1.7 billion. Tobira is a San, Francisco-based biopharmaceutical company specializing in drugs for non-alcoholic steatohepatitis (NASH) and similar liver diseases.
“The acquisition of Tobira is a strategic R&D investment within a white space area of our global gastroenterology franchise and an opportunity to advance the development of novel treatments for NASH,” said Allergan CEO and President Brent Saunders in a statement.
Here’s how the numbers break down.
Allergan will pay Tobira an upfront payment of $28.35 per share, which will be followed by an additional $49.84 per share as long as the company hits specific regulatory and sales goals related to two drugs in Tobira’s pipeline, cenicriviroc (CVC) and evogliptin.
CVC is an immunomodulator that blocks the CCR2 and CCR5 chemokine receptors. These play a role in the inflammatory and fibrogenic pathways in NASH that lead to liver damage, cirrhosis, or liver failure.
Results from a Phase 2b study showed CVC “demonstrated a clinically and statistically significant improvement in fibrosis of at least one stage without worsening of NASH, one of two key secondary endpoints, after one year of treatment,” according to Allergan’s statement.
Evogliptin is an oral inhibitor designed to treat NASH that is currently undergoing a Phase 1 trial assessing its safety and tolerability profile when used with and without CVC.
However, Tobira’s path to clinical development hit a snag this summer, reported FierceBiotech. CVC failed to meet its primary endpoint in the Phase 2b trial sending its shares down in premarket trading.
Still, both firms feel confident in moving forward with late-stage testing for CVC.
“Both the CVC and Evogliptin programs provide highly differentiated compounds that can make a significant impact in the treatment of NASH, where today there are no approved therapies available for patients,” said Allergan’s Chief Research & Development Officer David Nicholson.
The price Allergan is paying for this deal signifies how important drugs for liver disease are becoming for biotech companies. A survey conducted by Thompson Reuters earlier this year projected that drugs in this category could bring over $1 billion in sales.
Filed Under: Drug Discovery