Rockville gene therapy company RegenxBio Inc. just locked in a major deal with a pharmaceutical giant potentially worth more than $1 billion for the local player.
RegenxBio (NASDAQ: RGNX) said Monday it has teamed up with Chicago’s AbbVie Inc. (NYSE: ABBV) to develop and commercialize the Montgomery County biotech’s experimental gene therapy treatment for multiple eye diseases. That candidate, called RGX-314, is now being tested in numerous clinical trials for wet age-related macular degeneration (AMD), diabetic retinopathy and other chronic retinal illnesses.
Under the agreement, AbbVie will pay RegenxBio $370 million upfront, plus a potential additional $1.38 billion in development, regulatory and commercial milestones. Both companies said they’ll share profits from the product’s U.S. sales equally — once it earns regulatory approvals and gets to market — and that AbbVie will pay RegenxBio tiered royalties on international sales.
RegenxBio will handle the candidate’s ongoing studies, which include a phase 2 study in diabetic retinopathy; a phase 3 trial in wet AMD; and a third in wet AMD using a different delivery method, using a device at the doctor’s office.
Patients with wet AMD experience vision loss because new blood vessels form, and leak, in the retina. Those with diabetic retinopathy, which is caused by damage to certain blood vessels in the eye, can also experience blindness. These trials set out to give these patients a one-time treatment alternative to the current standard of care for wet AMD and diabetic retinopathy, which involves monthly or bimonthly injections into the eye to manage the conditions.
Going forward, the partners will share costs and work together to initiate any additional trials for RGX-314, including another late-stage trial in wet AMD expected to start in the fourth quarter.
The collaboration also has RegenxBio leading manufacturing for the candidate’s clinical development and domestic commercial supply, and AbbVie spearheading manufacturing for its commercial supply outside of the U.S. The companies said they will tag-team a commercialization plan within the U.S. while AbbVie will lead clinical development and commercialization globally.
The deal gives RegenxBio a gateway to the international market, as it looks to “leverage AbbVie’s global developmental and commercial infrastructure within eye care,” RegenxBio President and CEO Kenneth Mills said in a statement.
The transaction is expected to close by year’s end, subject to customary closing conditions and relevant regulatory approvals.
RegenxBio’s share price shot up Monday to a high of $43.21, after closing Friday at $34.02. The stock was trading up nearly 25% to $41.33 per share just after 1 p.m. Monday.
RegenxBio is also advancing several other gene therapy programs outside of ophthalmology, those focused on rare diseases such as mucopolysaccharidosis type II — or Hunter syndrome, a debilitating disease that affects young children — which kicked off a phase 1/2 study in 2020. The company is also developing gene therapy treatments for hereditary angioedema, a rare genetic condition involving painful swelling episodes, and Duchenne muscular dystrophy, a syndrome marked by frequent falls, learning disabilities and other symptoms that affects people with muscular dystrophy.
It all comes as the business settles into a new 132,000-square-foot headquarters where its more than 300 employees moved earlier this year. That site, still in Rockville at 9800 Medical Center Drive, grows and centralizes the biotech’s previous 80,000-square-foot footprint that was distributed across five locations. RegenxBio's new manufacturing facility, which is part of the new headquarters project, is slated to open in 2022.
That expansion followed a deal RegenxBio struck with Alpharetta, Georgia-based Clearside Biomedical Inc. (NASDAQ: CLSD) in September 2019, for rights to Clearside's platform to treat several eye diseases. That agreemen gave the local company Clearside’s in-office injection that it’s now studying as an alternative to surgery.
RegenxBio reported $40.9 million in revenue for the first six months of 2021, up from $34.2 million for the same period of 2020. That came partially from royalty revenues from Zolgensma, a gene therapy for spinal muscular atrophy in young children that relies on RegenxBio’s gene delivery platform. That drug was launched in 2019 by Novartis (NYSE: NVS), which inherited it when it acquired Chicago-based AveXis Inc.
The Rockville company also suffered a net loss of $107.8 million for the first half of 2021, an increase from the $74.3 million net loss it reported for the first half of 2020. RegenxBio closed June with $593 million in cash, cash equivalents and marketable securities.
