Under the terms of the deal, Sierra is paying Gilead an upfront fee of $3 million. There are various potential milestone payments that could reach up to $195 million. The companies indicate that most of the milestones are commercial ones, rather than developmental milestones. Gilead will also be eligible for tiered royalty payments that range from the mid-teens to high-twenties.
Momelotinib has been studied in two completed Phase III clinical trials for myelofibrosis. In those trials, the compound has shown a potentially differentiated therapeutic profile that includes anemia-related benefits, and substantive spleen and constitutional symptom control.
“The majority of myelofibrosis patients have anemia at diagnosis or develop it during treatment with other therapies, including ruxolitinib,” said Srdan Verstovsek, Medical Oncologist and Professor in the Department of Leukemia at The University of Texas MD Anderson Cancer Center, Houston, Texas, in a statement. “Anemia is the most significant negative prognostic indicator in myelofibrosis patients and, as a result, one of the most important disease consequences to address.”
Verstovsek goes on to say, “The therapeutic focus in myelofibrosis has traditionally been on treating the enlarged spleen and constitutional symptoms common to the disease. However, optimal drug therapy would also address disease-related cytopenias, including anemia and transfusion dependency, while also improving splenomegaly and symptoms. The Phase III clinical data for momelotinib demonstrate clinical benefits in all of these categories and I believe the drug candidate warrants further development. Given its anemia benefit, momelotinib could potentially become an important option for the treatment of myelofibrosis.”
Momelotinib is a selective and orally-bioavailable JAK1, JA2 and ACVR1 inhibitor. The drug was originally discovered and developed by Cytopia, an Australian biotech company. Cytopia was bought in 2011 by YM BioSciences. Nick Glover, president and chief executive officer of Sierra Oncology previously led YM BioSciences, where the company advanced momelotinib through Phase I/II studies. Gilead acquired YM in 2013.
“Opportunistically adding this compelling Phase III asset to our existing pipeline of next generation oncology drug candidates, SRA737 and SRA141, helps establish Sierra as a diversified late-stage drug development company with a commercial orientation,” Glover said in a statement. “The company is uniquely positioned to advance momelotinib towards potential registration with several members of the Sierra senior management team having played key roles in the development of momelotinib from its discovery through to Phase III clinical trials.”
Sierra also announced today that it had obtained a debt facility from Silicon Valley Bank to support its drug development programs, including momelotinib. Under the terms of the debt facility, Sierra can borrow up to $15 million in three $5 million tranches. The first $5 million tranche was drawn on loan closing. The rest can be drawn based on specific business and clinical milestones related to momelotinib. Another $25 million is potentially available.
“This credit facility provides us with the option to access minimally dilutive capital rapidly and incrementally as needed to advance momelotinib, while helping to ensure we remain well capitalized to prosecute our robust development program for SRA737 and commence the clinical program for SRA141,” Glover said in a statement. “With this facility, combined with our cash position of approximately $125 million as at June 30, 2018, we believe we have sufficient resources to deliver on key milestones across all three programs.”
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