Drug Research
Drug Discovery & Development

Taiho Pharmaceutical exercises option to develop AB928 in its territories

Published 16 July 2018

Arcus Biosciences announced that Taiho Pharmaceutical has exercised its option to obtain an exclusive development and commercialization license to the company’s adenosine receptor antagonist program, which includes AB928 and back-up compounds, in Japan and certain other territories in Asia (excluding China).

The agreement is part of the option and license agreement entered into in September 2017 (Taiho Agreement).

 In addition to an option exercise payment, Arcus is eligible to receive clinical and regulatory milestones totaling up to $130 million as well as commercialization milestones and royalties on net sales for this program.

“We are pleased that Taiho has decided to exercise their option just as we are initiating our Phase 1/1b program for AB928 in the U.S. and Australia,” said Terry Rosen, CEO at Arcus.

“We believe that Taiho’s decision to exercise their option to this program at this early stage reflects their recognition that AB928, the first adenosine 2 receptor antagonist in clinical development to be specifically designed for the oncology setting, has significant potential to treat a broad array of tumor types.

“We are confident that Taiho’s expertise and capabilities in oncology, as well as their experience co-promoting Keytruda® in Japan, make them the ideal partner to bring AB928 to cancer patients as quickly as possible in their territories.”

Arcus and Taiho entered into an option and license agreement in September 2017. Taiho will provide $35.0 million of cash payments to Arcus during the first three years of the agreement in exchange for an exclusive option, over a five-year period, to in-license the development and commercialization rights to clinical stage product candidates from Arcus’s portfolio for Japan and certain other territories in Asia (excluding China).

Taiho is obligated to pay an option exercise payment for each option exercise of between $3.0 million to $15.0 million, with the amount dependent on the development stage of the applicable Arcus program for which the option is exercised.

In addition, Taiho is obligated to pay to Arcus clinical, regulatory and commercialization milestones up to $275.0 million per program as well as royalties ranging from high single digits to mid-teens on net sales in Taiho’s territories.

AB928 is an orally bioavailable, highly potent antagonist of the adenosine 2a and 2b receptors. The activation of these receptors by adenosine interferes with the activity of key populations of immune cells and inhibits an optimal anti-tumor immune response.

 By blocking these receptors, AB928 has the potential to reverse adenosine-induced immune suppression within the tumor microenvironment. AB928 was designed specifically for the oncology setting, with a profile that includes potent activity in the presence of high concentrations of adenosine and a minimal shift in potency due to non-specific protein binding, both essential properties for efficacy in the tumor microenvironment.

AB928 has other attractive features, including high penetration of tumor tissue and low penetration through the healthy blood-brain barrier. In a Phase 1 trial in healthy volunteers, AB928 has been shown to be safe and well tolerated and to have pharmacokinetic and pharmacodynamic profiles consistent with a once-daily dosing regimen.

Source: Company Press Release