Otsuka acquires Jnana and its phenylketonuria asset for $800M upfront

Otsuka Pharmaceutical has entered into an agreement to acquire Jnana Therapeutics in a deal that could exceed $1.1 billion. This acquisition will bring Jnana's lead pipeline asset, JNT-517, a promising treatment for phenylketonuria (PKU), into Otsuka's portfolio. The transaction has been sanctioned by the boards of both companies and is anticipated to be finalized in the third quarter of the year.

Under the terms of the merger announced on Thursday, Otsuka will provide an upfront payment of $800 million upon closing. Additionally, Jnana's shareholders stand to receive up to $325 million contingent on achieving certain development and regulatory milestones. Makoto Inoue, president of Otsuka, commented that acquiring Jnana’s drug discovery technology and its small-molecule pipeline, which targets PKU and autoimmune diseases, will enhance Otsuka's research and development capabilities in the US. Moreover, Inoue emphasized that the merger will likely have a synergistic effect, fostering global expansion.

Jnana Therapeutics, established in 2017 with an initial funding of $50 million, utilizes its proprietary RAPID chemoproteomics platform. This technology is designed to identify drug candidates against targets that are validated but have historically been challenging to address. Through this platform, Jnana has developed JNT-517 specifically for PKU, and has also identified other small molecules targeting autoimmune disease markers like interferon regulatory factor 3 (IRF3). In 2020, Jnana entered into a partnership with Roche to develop small-molecule drugs aimed at metabolite transporters, a collaboration that was expanded in 2022.

JNT-517 is an allosteric small-molecule inhibitor of SLC6A19 and has shown promise in clinical trials. It has been demonstrated to be effective, well tolerated, and safe in a Phase Ib/II study, with the potential to benefit patients of all ages and varying degrees of disease severity. Joanne Kotz, chief executive and co-founder of Jnana, expressed confidence in advancing JNT-517 into a registrational study by 2025.