Biopharmaceutical firm Arrowhead Pharmaceuticals has signed a license and collaboration agreement with Janssen Pharmaceuticals for the development and commercialization of hepatitis B virus (HBV) treatment, ARO-HBV.
ARO-HBV is the third generation subcutaneously administered RNA interference (RNAi) therapeutic of Arrowhead being developed as a potential curative therapy for patients with chronic HBV infection.
The companies have also signed a research collaboration and option agreement for up to three additional RNAi therapeutics against new targets..
The license and collaboration agreements are said to be valued at around $3.7bn for Arrowhead.
As per terms of the deal, the company will secure $175m upfront payment from Janssen. Separately, Johnson & Johnson Innovation – JJDC will acquire $75m worth Arrowhead common stock by paying $23.00 per share.
Arrowhead will also secure up to $1.6bn milestone payments based on HBV license agreement, including $50m milestone payment associated with phase 2 study.
The company is also eligible to secure $1.9bn option and milestone payments based on collaboration agreement linked with three additional targets.
In addition, the company will secure tiered royalties up to mid teens on product sales.
The deal will provide Janssen with a worldwide exclusive license to the ARO-HBV program. The company will also take responsibility for clinical development and commercialization of AROHBV1001, which is Arrowhead’s ongoing Phase 1/2 study of ARO-HBV.
The biopharmaceutical firm will develop clinical candidates for the three new targets selected by Janssen. These new candidates are based on Arrowhead’s TRiM platform and are not part of the company’s current pipeline.
The company will carry out discovery, optimization and preclinical development for the candidates by using funds provided by Janssen.
Janssen will take responsibility for clinical development and commercialization, if the option is exercised.
Subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the transactions are expected to be completed in the fourth quarter of this year.
Arrowhead president and CEO Christopher Anzalone said: “Arrowhead has established a leadership position in the field over the past several years, and Janssen’s proven development capabilities, global commercial reach, and commitment to HBV make it the ideal partner to potentially accelerate our goal of bringing a functional cure to patients with chronic HBV.”