“It's not easy to do a deal at all in this environment,” Scorpion CEO Axel Hoos said.
French pharma Pierre Fabre is offering up to $553 million in biobucks to work with Scorpion Therapeutics on developing and potentially commercializing two of the biotech’s preclinical lung cancer candidates.
“It's not easy to do a deal at all in this environment,” Scorpion CEO Axel Hoos, M.D., Ph.D., told Fierce Biotech. “Then get a tailored deal that serves so many purposes for us—it’s a good accomplishment.”
The Boston-based oncology biotech is set to make $65 million from an upfront payment and near-term milestones tied to the exclusive licensing agreement. The deal centers around its early-stage, next-gen mutant epidermal growth factor receptor (EGFR) inhibitors for patients with non-small cell lung cancer (NSCLC).
Under the terms of the agreement, Scorpion will lead clinical development of one of the assets, dubbed STX-721, while Pierre Fabre will guide clinical activities on the other, STX-241. Scorpion will keep commercialization rights for all product launches in the U.S., Canada and Japan, while Pierre Fabre will take on commercial activities in all other territories, with a focus on Europe and China. Both companies will share expenses for global development.
If all goes to plan, Scorpion could make up to a total of $553 million in potential milestone payments down the line as well as royalties.
The terms of the deal ensure the two programs are fully resourced and will streamline global advancement, Hoos explained. It also fits into Pierre Fabre’s new vision—the medical and beauty care company has increased its focus on oncology, spending about 80% of its 2022 R&D budget in the space.
“Based on their preclinical data, we've concluded that STX-721 and STX-241 may present best-in-class product profiles,” Francesco Hofmann, Ph.D., Pierre Fabre’s head of R&D for medical care, said in an April 4 release. “Further, this partnership will significantly expand our efforts in precision oncology, allowing us to better support the care and treatment of thousands of people globally.”
The two assets that the pharma is adding to its repertoire are products of Scorpion’s precision oncology drug-hunting platform, dubbed Precision Oncology 2.0. STX-721 is an orally delivered small molecule designed to target exon 20 insertion mutations in EGFR. Various EGFR mutations are known as common drivers of NSCLC. Currently in preclinical studies, Scorpion anticipates submitting an application to launch clinical trials for STX-721 to the FDA in the third quarter of the year, according to Hoos.
The other asset, STX-241, is an orally delivered central nervous system-penetrant small molecule created to target treatment-resistant NSCLC patients who also have exon 19 or 21 mutations. The biotech intends to submit a trial application to the FDA for the asset in the first half of next year.
The assets represent two-thirds of the pipeline Scorpion has unveiled over its three years, a rate of development that Hoos believes speaks to the quality of the molecules and platform. The 2.0 tech includes genomewide CRISPR screening with medicinal chemistry and data capabilities such as chemical proteomics and supercomputing. In other words, the platform combines several innovations to develop small molecules that are more selective, which improves treatment efficacy and reduces toxicity.
Hoos, who joined Scorpion from GSK in 2021, said the prolonged biotech bear market and current financing climate haven’t made much impact on the company, which is still flying high from last year’s AstraZeneca deal that included a $75 million upfront payment. Today's licensing agreement is the second made during Hoos’ tenure at Scorpion and gives the biotech “the flexibility to give us everything we want to do.”
As for the market around Scorpion, Hoos said the impacts have mostly hit public biotechs, which has prompted Scorpion to stay private at this time. In October 2020, the company debuted with a $102 million series A, followed by a $162 million series B less than three months later.
The biotech's work is centered around its main asset STX-478, which Hoos claims is “one of the best small molecules I’ve ever seen.” The mutant-selective PI3Kα inhibitor aims to overcome selectivity and efficacy limitations associated with current agents for an array of tumor types. When asked if Scorpion was looking at partnerships for the preclinical asset, the CEO was quick to point out that would reduce the value of the program, stating the biotech has the capabilities to “go at it alone.”
Scorpion is also chugging away at other programs, though Hoos doesn’t think the biotech will be revealing much on its wider potential pipeline right now.
“Given the valuations that you see, if the focus is on PI3Kα, why would we disclose what else we're working on?” Hoos said. “We're only giving away information without getting anything in return.”
