Otsuka to acquire Jnana Therapeutics for $1.1bn

Otsuka Pharmaceutical is set to acquire Jnana Therapeutics, a clinical-stage biotech company, in a transaction valued at over $1.1 billion. This acquisition grants Otsuka access to Jnana's promising oral drug, JNT-517, aimed at treating phenylketonuria (PKU), a rare inherited metabolic disorder.

PKU affects between one in every 13,500 to 19,000 newborns in the United States. The disorder is characterized by a deficiency of the enzyme responsible for metabolizing the amino acid phenylalanine, which is present in nearly all protein-rich foods. When untreated, phenylalanine accumulates in the blood at dangerously high levels, causing severe progressive neurological impairment and psychological complications.

Jnana Therapeutics' JNT-517 is an allosteric small molecule inhibitor of SLC6A19, a solute carrier that manages amino acid reabsorption in the kidneys. Clinical trials, specifically a phase 1b/2 study, have already demonstrated JNT-517 to be effective, safe, and well-tolerated. The drug candidate is scheduled to move into a registrational study next year, with hopes of addressing the needs of PKU patients across all age groups and varying degrees of disease severity. Currently, most PKU patients are not adequately treated with available therapies.

In addition to JNT-517, the acquisition includes Jnana's RAPID platform, which is a next-generation chemoproteomics technology designed to discover medications for challenging-to-drug targets. Jnana’s CEO and co-founder, Joanne Kotz, highlighted the importance of their platform in discovering JNT-517, a potential first-in-class oral treatment for PKU. She expressed enthusiasm about joining Otsuka and advancing JNT-517 into a registrational study by 2025. Kotz also emphasized the company's ongoing efforts to develop innovative oral medicines for autoimmune diseases.

The merger agreement, which is expected to be finalized in the third quarter of the fiscal year, involves Otsuka paying $800 million to Jnana’s shareholders, with an additional $325 million contingent on development and regulatory milestones being met. Makoto Inoue, President and Representative Director of Otsuka, noted that acquiring Jnana’s drug discovery technology and small molecule pipeline would bolster Otsuka’s research and development initiatives, particularly in the Boston area. He also mentioned that this acquisition would have a synergistic effect on Otsuka’s global expansion efforts.

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