Otsuka Pharmaceutical is putting down $33 million cash for a Swedish biotech’s IL1RAP antibodies designed to treat autoimmune and inflammatory diseases.
The Japanese pharma is also offering the biotech Cantargia the chance to make up to $580 million in biobucks as well as to receive payments from potential global sales, according to a July 15 release.
In exchange, Otsuka gets global development and commercialization rights to Cantargia’s immunology program, dubbed CAN10. The antibody is designed to inhibit IL1RAP, a member of the IL-1 family.
Cantargia’s asset is currently being tested in a phase 1 trial for hidradenitis suppurativa, a chronic skin condition that causes the formation of small, painful lumps. The Stockholm-based biotech is also exploring the candidate in systemic sclerosis.
The deal also gives Otsuka a “backup antibody,” or a preclinical IL1RAP-targeting antibody that’s similar to CAN10, according to the release.
The Japanese drugmaker will also gain exclusive first rights to negotiation for any other next-gen IL1RAP antibodies Cantargia develops in a two-year time frame.
Cantargia touts an IL1RAP-based antibody platform designed to help quickly create new therapies across a variety of indications, according to the biotech. The company’s most advanced asset, known as nadunolimab or CAN04, is a midstage IL1RAP antibody being studied in combination with chemotherapy for various cancers.
Since the deal was announced, Cantargia’s stock has risen more than 200% to $3.90 per share on the Nasdaq Stockholm.
As for Otsuka, the pharma is expanding its autoimmune R&D pipeline, Makoto Inoue, president and representative director for the company, said in the release.
Just last month, Otsuka inked a deal worth more than $600 million in biobucks for ex-China rights to Harbour BioMed’s preclinical bispecific candidate. The pharma plans to use the T-cell engager to tackle certain autoimmune conditions.
The Japanese company is also using the antibody-drug conjugate and small-molecule platforms of its Visterra and Jnana Therapeutics subsidiaries, respectively, to expand further into the autoimmune space, Inoue said in the release.