Novartis Partners with MorphoSys, Galapagos in $1.1-Billion mAb Deal

Novartis is set to partner with MorphoSys, a late-stage biopharmaceutical company focused on the development and research of antibodies, and Galapagos, a clinical-stage biotechnology company specializing in the discovery and development of small-molecule drugs, to develop and commercialize their joint investigational, fully human, immunoglobulin G1 (IgG1) monoclonal antibody (mAb) directed against the target interleukin (IL)-17C. The collaboration is worth up to $1.1 billion.

Under the terms of the agreement, the companies will broaden the existing development plan for MOR106, an investigational fully human IgG1 mAb designed by MorphoSys and Galapagos to target IL-17C in atopic dermatitis (AtD). Novartis will hold exclusive rights to commercialize any products resulting from the agreement. Upon signing the agreement, Novartis will be responsible for all future research, development, manufacturing, and commercialization costs for MOR106. MorphoSys and Galapagos will conduct additional trials to support development of the drug candidate in AtD. Novartis will explore the drug’s potential in additional indications other than AtD.

In addition to the funding of the current and future MOR106 program by Novartis, MorphoSys, and Galapagos will jointly receive an upfront payment of EUR 95 million (US$111 million). Pending achievement of certain developmental, regulatory, commercial, and sales-based milestones, MorphoSys and Galapagos would jointly be eligible to receive significant milestone payments, potentially amounting up to approximately EUR 850 million (US$1 billion), in addition to tiered royalties on net commercial sales in the range of up to low-teens to low-twenties. According to their 2008 agreement, Galapagos and MorphoSys will share all payments equally.

The agreement between MorphoSys, Galapagos, and Novartis is subject to clearance by the United States antitrust authorities under the Hart-Scott-Rodino Act and will become effective as soon as this condition has been met. 

"This collaboration with Novartis will enable us to accelerate and broaden the development of MOR106 beyond our current focus on atopic dermatitis and to exploit the potential of MOR106 to the maximum,” said Dr. Simon Moroney, CEO of MorphoSys AG, in a July 19, 2018 press release. “Data from preclinical models and expression analyses suggest that the target of MOR106 might be involved in other diseases, which justifies expanding the development program. We are also very pleased that we can further strengthen our engagement in atopic dermatitis by starting additional trials together with Galapagos, which will be fully reimbursed by Novartis. Securing a strong and committed partner for MOR106 helps the program, and also enables us to allocate more resources elsewhere."

Source:  MorphoSys