Biogen, looking to diversify, acquires immune drugmaker HI-Bio for $1.15B
Drug ApprovalImmunotherapyPhase 2AcquisitionPhase 1
Dive Brief:
Biogen is scooping up a closely held immunology startup to bring more diversity to a pipeline best known for neurology products.
Per deal terms, Biogen will pay $1.15 billion in cash up front to acquire Human Immunology Biosciences, or HI-Bio, and as much as $650 million more if the startup’s lead drug achieves certain milestones. The medicine, felzartamab, has completed Phase 2 trials for two kidney conditions, with a third study ongoing.
Dive Insight:
The purchase is a welcome step in lowering the overall risk of Biogen’s pipeline, analysts said. With promising early results and plans to start Phase 3 research, felzartamab is a “versatile pipeline agent,” Piper Sandler analyst Christopher Raymond wrote in a note to investors.
“A key strategic question that has dogged Biogen for years has been the company’s singular (some would call stubborn) focus on neurology – traditionally among the highest risk therapeutic categories in all of drug development,” Raymond said. “With this deal, we see management finally addressing this strategic issue.”
Biogen has been under pressure to rev up growth after a long period of stagnant sales due to increasing competition for its core multiple sclerosis franchise and stumbles with newer products, including the Alzheimer’s disease drug Aduhelm. Once considered a potential blockbuster, Aduhelm won a controversial approval and then failed in the market. Biogen gave up on the product earlier this year.
Meanwhile, the company has seen mixed results for the rest of its neurology pipeline. In April last year, Biogen won approval for a new ALS medicine called Qalsody, but this month quit development of another experimental drug for the condition after disappointing study results. More promising is the launch of Leqembi, an Alzheimer’s treatment whose growth is drawing more investment from Biogen.
CEO Chris Viehbacher, who joined the company in 2022, told investors he was looking beyond neurology as he tried to turn Biogen’s fortunes around. Since then, he’s brought on a new head of research and spent $7.3 billion on a takeover of the rare disease drugmaker Reata Pharmaceuticals.
HI-Bio fits into Viehbacher’s plan to expand Biogen’s presence in immunology. The company, incubated by Arch Venture Partners and Monograph Capital, licensed both felzartamab and another drug, dubbed HIB210, from the German drugmaker MorphoSys, which is now being acquired by Novartis. HIB210 is in Phase 1 testing and has the potential to treat a range of immune-mediated diseases, Biogen said.
Felzartamab has completed Phase 2 studies in primary membranous nephropathy and antibody-mediated rejection in kidney transplant patients. The ongoing study focuses on patients with IgA nephropathy. HI-Bio plans to advance all three indications to Phase 3, Biogen said.
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