Clovis Offloads Cancer Candidate to Novartis, Day After Declaring Bankruptcy
After voluntarily filing for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code on December 11, Clovis announced it would sell FAP-2286, a promising clinical candidate, to Novartis for $50 million upfront the following day. The sale is the first in a likely series of sales, which Clovis hopes to make under Section 363 of the U.S. Bankruptcy Code until the company has to wind down any legacy assets or liabilities not sold in the process.
A Rough Few Years Leading to Bankruptcy
In November, Clovis released a quarterly filing highlighting its financial concerns, saying under current conditions at the time, the company would not have enough money to continue operations beyond January 2023. The troubling document stated, “a potential bankruptcy filing in the very near term looks increasingly probable.”
As predicted, this time with a press release, Clovis filed for bankruptcy on December 11. Clovis blamed most of its troubles on its only commercialized product, Rubraca, and its poor performance over the last few years.
Initially approved as a second-line treatment for ovarian, fallopian, and primary peritoneal cancer in 2016, Clovis had high hopes for Rubraca. In the following years, the FDA approved Rubraca for additional indications like second-line prostate cancer treatment and maintenance treatment for ovarian, fallopian, and peritoneal cancer.
Despite what seemed like success from the outside looking in, Clovis said the COVID-19 pandemic substantially impacted Rubraca’s sales for two years due to decreased patient visits and diagnoses. Then, with changes to the FDA’s protocol to focus more on mature overall survival (OS) data compared to progression-free survival (PFS), Clovis said Rubraca struggled even more. As a result, Clovis voluntarily withdrew Rubraca from the market to treat its initial indication as a second-line treatment for ovarian, fallopian, and primary peritoneal cancer.
With these factors compounding to Rubraca’s sales decreasing over time, Clovis had no other option but to file for bankruptcy and sell all its assets in the coming months.
The First Sale of Many to Come
Just a day after it declared bankruptcy, Clovis announced the sale of FAP-2286 to Novartis. FAP-2286 is a peptide-targeted radionuclide therapy (PTRT) and an imaging agent targeting fibroblast activation protein (FAP) Clovis is developing to target various solid tumors.
Novartis will lay down $50 million upfront for the candidate, with the potential for up to $333.75 million in development milestones. Clovis could make an additional $297 million in sales milestones if the product makes it to market. The Bankruptcy Court will monitor the sale, which allows for higher offers and additional conditions if the Court agrees.
Clovis said it is looking to “sell substantially all of its assets,” which will also be monitored by the Bankruptcy Court. The company still has another candidate, Rucaparib, to sell, and of course, Rubraca.
After a rocky few years with only one declining commercialized product, Clovis’ bankruptcy filing was inevitable. Now that it has come to fruition, the company is quickly offloading its assets, starting with its lead candidate, FAP-2286, which will hopefully be in good hands with Novartis.©www.geneonline.com All rights reserved. Collaborate with us: email@example.com