Novartis Plans to Acquire Chinook Therapeutics in a Potential $3.5B Deal, Revolutionizing IgAN Treatment Landscape

In a press release issued on June 12, Novartis announced that it has entered into an agreement to acquire Chinook Therapeutics, a Seattle-based clinical-stage biopharmaceutical company that is developing two high-value, late-stage medicines for treating IgA nephropathy (IgAN), a rare and severe chronic kidney disease. 

This agreement is in line with Novartis’ strategy to concentrate on innovative products. The Swiss pharma giant plans to buy Chinook for up to $3.5 billion with the aim of expanding its portfolio for renal diseases based on the existing pipeline.

Related article: Travere Snags Accelerated Approval for First Non-Immunosuppressive IgAN Therapy

IgAN as a Rare but Debilitating Kidney Disease

IgAN is an autoimmune kidney disorder that mostly affects young adults and lacks targeted treatment options at the present time. It is the most common primary inflammation of tiny filters in the kidney (glomerulonephritis) worldwide, with an incidence of 2.5 per 100,000 population per year. A 2022 study found that the 10-year risk of progression of IgAN to end stage renal disease (ESRD, also known as kidney failure) or halving of estimated glomerular filtration rate (eGFR, one of the important measures of kidney function) is 26%.

As the name suggests, IgAN is a result of deposits of the abnormal form of antibody immunoglobulin A (IgA) inside the filters of the kidney (glomeruli), causing inflammation and impaired kidney function. Increasing kidney damage can lead to proteinuria (protein in the urine), hematuria (blood in the urine), and edema in the hands and feet. In the event that ESRD develops, patients will require dialysis or a kidney transplant to stay alive.

Chinook’s Promising Pipeline in IgAN Treatment

Chinook has deep expertise in modeling and understanding kidney disease and the company is actively engaging in the development of precision medicines for kidney diseases. In mid-May, Chinook announced partnership with California-based Ionis Pharmaceuticals for the discovery, development and commercialization of an antisense oligonucleotide (ASO) therapy for a rare, severe chronic kidney disease with significant unmet medical need. Novartis proposed this major acquisition for Chinook mainly because of the company’s two new high-value, late-stage medications in development for treating IgAN: Atrasentan and Zigakibart. 

Atrasentan is a selective endothelin A receptor antagonist (ERA) that Chinook bought from AbbVie in December 2019 in a deal worth up to $135 million in milestones. A Phase 3 ALIGN trial is currently underway to assess its efficacy and safety in treating IgAN. Previous Phase 2 study has already demonstrated that this oral drug can bring about a significant reduction in proteinuria versus baseline with good tolerability, including liver safety profile. In addition, atrasentan is also in early-stage development for other rare kidney diseases.

Zigakibart (BION-1301) is a proprietary anti-APRIL monoclonal antibody. It is a subcutaneously administered drug with the potential to prevent the production of abnormal galactose-deficient IgA, thereby addressing the root cause of IgAN and preserving kidney function. Phase 1/2 data to be presented on June 16 at the 60th European Renal Association (ERA) Congress being held in Milan, Italy, show an impressive reduction in proteinuria compared to baseline. Besides, a Phase 3 study in IgAN is scheduled to begin in Q3 2023.

Selected Details of the $3.5B Deal

Under the terms of the agreement, which has been unanimously approved by the boards of both companies, Novartis will acquire Chinook for a total value of up to $3.5 billion through a merger of Chinook with a newly formed subsidiary of Novartis. As part of the deal, Chinook has accepted a buyout bid worth $3.2 billion upfront ($40 per share), plus $300 million payable in cash upon achieving certain regulatory milestones. Following the expected closing of the transaction in the second half of 2023, Chinook will continue to operate as a separate and independent company.

CEOs of both companies have expressed optimism about the deal, stating that it presents a unique opportunity to address one of society’s most challenging healthcare issues, which may result in additional much-needed treatment options for kidney disease patients.

Author

Richard Chau