ALK Licenses Rights to Neffy®, First Approved Adrenaline Nasal Spray for Anaphylaxis

ALK (ALKB:DC / OMX: ALK B) has recently signed a strategic license agreement with ARS Pharmaceuticals, Inc. (“ARS Pharma”, NASDAQ: SPRY). This agreement grants ALK exclusive global rights to the neffy® adrenaline (epinephrine) nasal spray, excluding the markets in the USA, Australia, New Zealand, Japan, and China. This partnership is a significant step in ALK’s Allergy+ strategy, aiming to expand the company's long-term financial goals.

The needle-free neffy® nasal spray presents a promising alternative for treating anaphylaxis, a severe allergic reaction. The European Commission granted market authorization for neffy® in August 2024, followed by approval from the US Food and Drug Administration (FDA) in the same month. Plans are underway for regulatory approval in Canada by the end of 2024.

Peter Halling, ALK’s CEO, expressed enthusiasm about the agreement with ARS Pharma, highlighting its importance in ALK’s strategic initiatives to lead in anaphylaxis and food allergy management. He emphasized the strong scientific and commercial connections between emergency allergic reaction treatments and ALK’s existing product range. Halling believes neffy® will revolutionize anaphylaxis treatment, benefiting at-risk patients and expanding the market significantly.

Furthermore, the agreement grants ALK rights to future indications of the intranasal adrenaline technology, including its use in treating acute urticaria flares, which is currently under development. ARS Pharma plans to start a Phase IIb clinical trial for this new indication in 2025. This aligns with ALK’s strategy to venture into new, related disease areas.

Initially, ALK will focus on launching neffy® in Europe and Canada, the second and third largest markets for adrenaline autoinjectors (AAIs). The product will be integrated into ALK’s existing infrastructure and sales channels in these regions, with potential for expansion into other markets such as Asia and the Middle East.

Immediate treatment with adrenaline is crucial for anaphylaxis, and currently, it is mostly administered intramuscularly using AAIs like ALK’s Jext® pen. Despite their effectiveness, there are limitations that often lead to delayed or missed treatment. In Europe, around 20 million people are at risk of anaphylaxis, but only about 2 million obtain the recommended rescue medication, and many do not renew their prescriptions as needed. The combined value of the European and Canadian AAI markets is estimated at approximately DKK 1.6 billion (2023) and has been growing steadily.

According to ALK’s Allergy+ strategy, the company aims to offer a portfolio of innovative solutions to help patients at risk of anaphylaxis. ALK will continue to market the Jext® autoinjector while developing the next-generation adrenaline autoinjector through its Genesis project. Halling acknowledged that while nasal delivery of adrenaline could become a new standard of care over the next decade, changing long-standing clinical practices will take time. Thus, ALK will maintain a diverse portfolio to meet the various needs of patients and prescribers.

The financial aspects of the agreement are substantial. ALK will pay ARS Pharma USD 145 million upfront, with potential additional payments up to USD 320 million related to regulatory and commercial milestones over the next 15+ years, along with tiered royalties on future sales. ARS Pharma will provide the finished goods to ALK, which will handle local market access, marketing, and sales.

ALK will finance the upfront payment from its available cash and existing credit facilities, with future milestone payments and royalties also coming from available cash. The net debt to EBITDA ratio for 2024 is expected to remain below 1 following the upfront payment.

The first market launches in Europe are anticipated in 2025, following local market access negotiations. The license agreement is expected to contribute to revenue growth from 2025 onwards, with an initially limited impact, and is projected to be earnings accretive within a few years. This agreement supports ALK's long-term financial goals and does not alter ALK’s revenue and earnings outlook for 2024. The ambition of achieving a 25% EBIT margin in 2025 remains unchanged.