Making renal disease a top priority

LONDON—AstraZeneca PLC got a boost to its pipeline in earlyOctober as it struck a deal with Fremont, Calif.-based Ardelyx Inc. for aworldwide exclusive license for Ardelyx's NHE3 inhibitor program, including thePhase II-ready lead compound RDX5791 that is aimed at irritable bowel syndromeand renal disease.

Under the terms of the agreement, AstraZeneca will pay a $35million upfront fee, with development milestones of as much as $237.5 millionrelated to launch and commercialization of potential drug candidates, as wellas tiered, double-digit royalties.

Ardelyx will conduct clinical trials in Phase II trials forthe NHE3 inhibitors, though AstraZeneca will assume the subsequent developmentcosts. As part of the transaction, Ardelyx has secured an option to co-promotethe product in the United States, subject to agreed limitations.

Additional financial details were not disclosed.

Ardelyx CEO Mike Raab tells ddn that it's a particularly good time for a deal likethis in part because "given the increased incidence of diabetes and obesity andresulting kidney disease, many pharmaceutical companies have come to realizethat therapeutics for the complications of renal disease may be one of thelargest underserved market opportunities in medicine. That, coupled with theexpiration of patent life for multibillion dollar drugs, has led severalpharmaceutical companies to prioritize to the top of their in-licensing listsdrugs for renal disease."

Add the recent safety failure of bardoxolone in Phase IIIclinical trials, "a drug with extremely high promise for renal patients," Raabnotes, and that "points to the even more urgent need to find drugs that canimpact this disease and improve outcomes for these patients."

He points out that AstraZeneca has been aggressive aboutpursuing novel medicines, making the company what he characterizes as "amongthe best possible worldwide partners for validating Ardelyx's unique approachto drug development," also having noted in a news release about the deal thathe has been impressed with his interactions with AstraZeneca throughout thelicensing process, adding to his confidence that the British company has thenecessary commitment to develop the RDX5791 molecule successfully.

NHE3, or sodium-hydrogen antiporter 3, is a proteinessential in the absorption of sodium in the intestines, and the NHE3 inhibitorRDX5791 is intended for the treatment of complications associated with end-stagerenal disease and chronic kidney disease. Another notable point about RDX5791,Raab has noted, is that it is his company's "first clinical example of how ourtechnology can be used to develop non-absorbed, small-molecule therapeutics."

Ardelyx has evaluated RDX5791 in a Phase IIa clinical trialin constipation-predominant irritable bowel syndrome (IBS-C) and in two Phase Iclinical studies in healthy subjects for its ability to divert sodiumabsorption in the gastrointestinal tract. Through its unique mechanism ofaction, RDX5791 is believed to decrease the absorption of dietary sodium andthus divert sodium excretion from the kidney to the feces, sparing the kidneyand the cardiovascular system from unhealthy exposure to both sodium and fluidaccumulation.

It is on the basis of this mechanism of action, Ardelyx andAstraZeneca say, that they plan to develop RDX5791 for use in end-stage renaldisease and chronic kidney disease in addition to IBS-C. They also haveexpressed an intention to explore development opportunities for other diseasesthat are a consequence of sodium and fluid overload.

"Building our pipeline is our number-one priority, and thisagreement with Ardelyx presents an opportunity to leverage AstraZeneca's globalcapabilities in drug development and our commercial capabilities incardiovascular disease, diabetes and now complications of diabetes," saysGunnar Olsson, vice president and head of CVGI Innovative Medicines atAstraZeneca, adding that the compound has the potential to meet a significantneed among patients with renal complications linked to diabetes and otherconditions who currently have limited treatment options.

AstraZeneca had already identified renal indications as anarea with a large unmet medical need, Olsson notes. His company has evaluateddifferent approaches and "identified mechanisms targeting sodium and fluidoverload as an area we wanted to pursue," he explains. "We have been aware ofArdelyx for some time and identified them as having a program that is pursuinga relevant mechanism. In looking in more detail, we found the Ardelyx programto be very promising. In our interactions with Ardelyx, we found them to be avery capable, experienced and professional team. Moreover, it was clear thatArdelyx and AstraZeneca had good chemistry as potential partners."

Looking at the deal, Zacks Investment Research commented inan investor note that "We are encouraged by AstraZeneca's focus on thehigh-potential emerging markets. We are pleased with its efforts to expand itspipeline and portfolio through mergers and acquisitions." According to Zacks,this Ardelyx agreement—along with the acquisition of Ardea Biosciences Inc., arecent collaboration deal with Amgen Inc. and the expansion of a diabetesalliance with Bristol-Myers Squibb Co.—"all represent the company's efforts inthis direction. We expect more such deals in the near term."

However, Zacks points out that it remains concerned aboutgeneric competition faced by the company's key products, noting that in 2011,the company lost revenues worth almost $2 billion to generics. The firm alsoadded, "The weak late-stage pipeline at AstraZeneca coupled with slow Brilintauptake also bothers us," leading to a Neutral recommendation from Zacks rightnow regarding AstraZeneca stock.