The ever-nimble company Celgene (NASDAQ: CELG) was back in the news last week, signing a sweetheart deal with AstraZeneca (NYSE: AZN) that brings access to a Phase III immune checkpoint therapeutic.
The deal between Celgene and Astra Zeneca is remarkable for balancing the relative strengths and weaknesses of each company. For AZN the deal enhances the competitive reach of the anti-PD-L1 mAb MEDI4736, now backed by a rich war chest and the potential for combination therapy with Celgene’s myeloma and hematologic malignancy portfolio. Notably, these diseases have remained relatively indifferent to monotherapy with immune checkpoint therapeutics, with a few exceptions. Refractory multiple myeloma, an indication that Celgene dominates, is particularly resistant to monotherapy with immune checkpoint therapeutics and the bet is that efficacy will be seen when MEDI4736 is paired with Celgene’s approved drugs lenalidomide and pomalidomide, among others. The deal may also ultimately bring access to first line solid tumor patients in the form of a MEDI4736 combination with Celgene’s Abraxane, a synergy that has been overlooked I think.
For Celgene this is an overdue move into the immunotherapy space and reflects their willingness to spend their way into contention and expand market dominance from multiple myeloma into other hematological malignancies, a counter of sorts to Abbvie’s buyout of Pharmacyclics and it’s B cell cancer blockbuster Imbruvica. Celgene has already made forays into the immuno-oncology space with it’s in-licensing of Inhibrx’ anti-CD47 antibody and the deal with VentiRx and Array Biopharma to develop VTX-2337, a TLR8 agonist but these are much earlier stage assets. It is reasonable to predict that Celgene will also move quickly to acquire additional assets in the immune checkpoint space.
I’d expect to see both AZN and Celgene aggressively pursue additional deals. AZN did exactly that with Juno Therapeutics (combining CAR T and anti-PD-L1 therapies) and Innate Pharma in separate deals two weeks ago. It is interesting to speculate that there is additional synergy between the Innate Pharma programs and the Celgene programs that could be explored later on.
More importantly I think, and looking ahead, both AZN and Celgene are building multiplatform immuno-oncology companies, with cellular therapeutics (CAR-T and TCR), antibody therapies, targeted therapeutics, and immune checkpoint therapeutics – a broad reach across the evolving oncology clinical landscape, similar to the position Novartis has built for itself. Both AZN and Celgene floated that their deal could grow into a larger collaboration, if so, this means that similar deals in this space will have to become bigger and broader just to keep up. Merck and Pfizer’s recently announced collaboration is a good example of a deal not quite juicy enough to be transformative in the way the AZN/Celgene hookup may be for both of these companies. Novartis recently stated that they are looking for acquisitions in the 2-5 billion dollar range – this gives us a sense of scale required. We are entering a phase of “go big or go home” and the winners will dominate oncology clinical care.