Zogenix, Inc. today announced that it acquired Brabant Pharma, a privately-held U.K.-based pharmaceutical company for $20 million in cash and $15 million in stock plus potential future milestone and royalty payments. The acquisition includes worldwide development and commercialization rights to Brabafen(TM), low-dose fenfluramine, for the treatment of Dravet syndrome, a rare and catastrophic form of intractable epilepsy that begins in infancy. Brabafen has recently received orphan drug designation in Europe and the U.S. for the treatment of Dravet syndrome.
Children with Dravet syndrome, also known as Severe Myoclonic Epilepsy of Infancy (SMEI), experience frequent, severe and potentially life-threatening seizures that typically start in the first year of life. These seizures do not respond to standard anti-epileptic medications and current treatment options are very limited.
The latest results from an ongoing, long-term clinical study in 15 Dravet syndrome patients treated with Brabafen show that 93% of patients were either seizure-free or had greatly reduced seizure frequency, during an average treatment period of greater than 12 years.
The results also demonstrate the safety of Brabafen, which was shown to be well tolerated and treatment side effects were mild and transient for the entire study treatment period.
Joseph Sullivan, M.D, director of the University of California at San Francisco Pediatric Epilepsy Center, said, “Based on the available long-term clinical data, Brabafen has the potential to transform the quality of life for Dravet syndrome patients by eliminating or reducing seizures. The prognosis for seizure control in these patients is poor and current treatment alternatives offer little benefit. However, if the current positive results are demonstrated in controlled Phase 3 clinical trials, Brabafen could be a breakthrough treatment for patients with this catastrophic epilepsy syndrome.”
The safety and effectiveness of Brabafen has been evaluated in a continuing, long-term, open-label, study in 15 Dravet syndrome patients. The average duration of treatment in this study is currently more than 12 years, with the longest duration of treatment at more than
26 years. More than two-thirds (67%) of patients were seizure free for at least a year after the latest assessment with an average seizure free period of 5.5 years. The majority (87%) of patients had a greater than 75% reduction in seizure frequency. There were no reports of pulmonary hypertension and there were no deaths. Two patients showed sub-clinical evidence of cardiac valve thickening that was judged to be clinically insignificant following detailed investigation by independent cardiologists. Similar findings spontaneously resolved in a third patient.
“Since securing an exclusive license from the Universities of Antwerp and Leuven in Belgium for the key clinical studies conducted by collaborators Berten Ceulemans, M.D., Ph.D. and Lieven Lagae, M.D., Ph.D., Brabant has made remarkable progress in defining the overall development program and regulatory filing strategy through formal meetings with the U.S. Food and Drug Administration and the European Medicines Agency. Based upon agency feedback, we plan to initiate two Phase 3 studies (of 40 to 60 Dravet syndrome patients per study) in the second quarter of next year in the U.S. and Europe, with top line results potentially available in the first half of 2016,” said Stephen Farr, Ph.D., president of Zogenix. Dr. Farr continued, “With the addition of this potential breakthrough product candidate, Brabafen, to our development programs for two abuse deterrent formulations of extended-release hydrocodone and Relday, we believe Zogenix is poised to reach key clinical studies results and regulatory submissions every year from 2015 through 2018.”
“This is a transformational acquisition for Zogenix. While we remain engaged in strategic opportunities for Zohydro ER, including pursuit of a co-promotion partner and development of abuse deterrent formulations, the addition of Brabant’s Dravet syndrome program significantly enhances our CNS development pipeline,” said Roger Hawley, chief executive officer of Zogenix.
“We believe the positive, durable long-term results of Brabafen place us in a leadership position within the Dravet syndrome community. We are fully committed to bringing this promising therapeutic to market for the benefit of these children and their families,” added Mr.
In addition to the $35 million acquisition cost in cash and Zogenix stock (11,995,202 shares to be registered), the terms of the purchase agreement includes $50 million in potential regulatory milestone payments and up to $45 million in royalty payments on Brabafen sales.
The first milestone payment is not anticipated until late 2016 upon submission of the New Drug Application for Brabafen.
Zogenix also signed a non-binding term sheet which, subject to the negotiation and execution of definitive documentation, is anticipated to provide a $20 million term loan plus an additional $4 million in a revolving line of credit. This potential financing is expected to help fund research and development expenses for Brabafen and Relday, and the launch, if approved, of an abuse deterrent formulation of Zohydro ER.
Expenses related to the Phase 3 clinical programs for Brabafen are estimated at $10 million, with an additional $5 million in post-approval clinical expenses. The Company ended the third quarter of
2014 with approximately $50 million in cash plus an additional $8.5 million remaining in escrow from the sale of Sumavel DosePro earlier this year. The Company anticipates combined selling, general and administrative expenses and research and development expenses, including expenses related to the acquisition, for the second half of the year 2014 to be $50 million to $55 million, towards the low end of the full-year guidance range previously provided.