Two deals; one goal

SAN FRANCISCO—Amarantus BioScience Holdings has struck two deals that bring it closer to its goal of spinning off a standalone neurodiagnostic company with a comprehensive portfolio of diagnostic tests for Alzheimer’s disease and other degenerative disorders. First, the company has acquired DioGenix, a Geneva-based molecular diagnostics company with a pipeline of diagnostic tests focused on immune-mediated neurological diseases; second, it has signed an option agreement with Georgetown University that could lead to an exclusive license to blood-based biomarkers related to Alzheimer’s disease.  

 

Gerald Commissiong, Amarantus president and CEO, tells DDNews that the company anticipates that DioGenix’s diagnostic test for multiple sclerosis (MS) has the potential to generate significant revenue as Amarantus continues to develop its diagnostic products focused on Alzheimer’s. “We were attracted to DioGenix because it is in line with our focus on neurogenerative disorders, but also because of its potential to generate revenues until the Alzheimer’s market transitions from a investigational stage market to a true commercial market opportunity,” he says.  

 

Amarantus’ purchase of DioGenix through a nearly $11 million deal was motivated in part by interest in the acquired company’s lead product, MSPr-cise. The diagnostic test targeting MS is designed to enable doctors to provide more precise diagnoses for patients with unclear neurological dysfunction. The merger leaves Amarantus with all rights to MSPrecise and all other DioGenix products under development, including tests that target neurosarcoid, neuromyelitis optica, paraneoplastic disease and amyotrophic lateral sclerosis.  

 

Commissiong says that MSPrecise will expand the breadth of Amarantus’ offering and build the company’s reputation as a premier neurodiagnostic targeting company, noting, “MSPrecise is a groundbreaking advancement for the diagnosis of multiple sclerosis and is anticipated to play a pivotal role, given the current high rate of misdiagnosis. MSPrecise is a lab-developed test, and the successful completion of a validation study paves the way for this clinically important test to be commercialized in 2015.”  

 

MSPrecise has undergone a clinical validation study that found it to provide significant improvement in classifying early-stage relapsing-remitting multiple sclerosis patients when compared with the current diagnostic standard of care by cerebrospinal fluid analysis.  

 

The difficulty of precisely diagnosing MS leaves open a very significant unmet medical need for better diagnostic testing of the disorder. Patients with non-specific clinical symptoms or symptoms that are consistent with MS currently undergo a battery of diagnostic tests, and it often takes doctors many months to settle on a clear diagnosis. Moreover, the accuracy of the diagnostic tests that are now standard are quite low. False-positive results can potentially expose patients who do not have MS to chronic and expensive therapy that exacerbates their underlying disease, while false-negative results can delay patients who do have MS from receiving proper treatment.

 

The market for drugs treating MS is currently valued at more than $14 billion. Misdiagnosis rates of over 50 percent have been routinely reported as the cost of false-positive diagnoses has soared. This is the basis for a worldwide market estimated at over $2 billion, growing in line with the cost of MS therapy.

 

Amarantus is paying for its acquisition by issuing registered shares of its common stock valued at $8 million to DioGenix and providing up to $900,000 for costs associated with the merger. Additionally, Amarantus agreed to pay up to $2 million in payments tied to the achievement of sales milestones.  

 

As for the second deal, the new agreement between Amarantus and Georgetown University is geared toward the development of improved diagnostic tests for Alzheimer’s disease. Robert Stern, a member of Amarantus' scientific advisory board and professor of neurology at Boston University School of Medicine, tells DDNews that it is critical for companies like Amarantus to develop effective diagnostic tests that can identify Alzheimer’s in its earliest stages in order to take full advantage of new treatments for the disease being developed.  

 

“These drugs will be most effective if they are initiated at very early stages of the disease, prior to the irreversible damage to brain tissue,” he says. “To accomplish this, it is critical to have highly accurate, noninvasive and cost-effective methods of diagnosing Alzheimer’s disease, at early stages, even prior to the beginning of symptoms. We cannot move forward in our quest for successful Alzheimer’s treatments without improved diagnostic testing.”

 

The one-year, exclusive option agreement offers Amarantus a license for the patent rights related to certain blood-based biomarkers for memory loss that Georgetown and University of Rochester jointly own. The company will be required to achieve milestones, including providing Georgetown with development and commercialization plans for the biomarkers, sharing information related to diagnostic assets and recruitment of a senior executive to lead Amarantus’ diagnostics division.  

 

“The combination of the blood-based biomarkers in the Georgetown panel, including measures based on lipidomics and on the exciting new field of brain-derived exosomes, in addition to Amarantus’ Lymphocyte Proliferation Test, may prove tremendously valuable in detecting Alzheimer’s disease accurately and at early stages of the disease,” says Stern.