Pharma, BioPharma

Roche’s $725M Seragon deal hasn’t gone as planned

Moving right along… Roche quietly disclosed in its Q1 financial report that it has scrapped a Phase 2 breast cancer asset, acquired in a $725 million buyout of Seragon Pharmaceuticals.

Money in basket. Isolated over white

As the saying goes, don’t throw good money after bad.

Roche dropped an upfront $725 million to purchase San Diego, California-based Seragon Pharmaceuticals in mid-2014, with up to $1 billion in future milestones on the cards. But it’s all for nothing if the science isn’t there.

That seems to have been the case with the lead asset from the deal, RG6046, a HER-negative breast cancer candidate that Roche marched into Phase 2 trials.

On Thursday, the Swiss pharma giant disclosed in its Q1 financial update that it has now canned that development program. The news was buried as a footnote in slide 54 of the 62-slide deck. It wasn’t acknowledged in the accompanying media release, titled “Roche Reports a Good Start in 2017.”

In a statement supplied to Endpoints News later in the day, Roche said it was still committed to that class of molecules, known as selective estrogen receptor degraders (SERDs). RG6046 is just looking a little dated.

We have learned much about the SERD biology with targeting the estrogen receptor. Based on current data, GDC-0927, another next-generation oral SERD, appears to have greater potential than GDC-0810 to be a best-in-class SERD molecule. We have decided to move forward with GDC-0927 in patients with metastatic hormone receptor-positive/HER2-negative breast cancer building upon what we have learned in the clinic with GDC-0810.

Seragon was an offshoot of Aragon Pharmaceuticals, a San Diego cancer company that was acquired by Johnson & Johnson for $650M in 2013. Roche acquired Seragon the following year. At the time, RG6046 (formerly ARN-810) was in Phase 1 trials. Everything else was preclinical.

RG6046’s replacement GDC-0927/SRN-927 was also part of the Seragon package. Roche has now moved it into the clinic, embarking on a Phase 1 trial for postmenopausal women with locally advanced or metastatic estrogen receptor-positive breast cancer.

It’s a field the company knows well, having developed the longstanding Herceptin, Kadcyla, and Perjeta dynasties. All three target HER-2 positive breast cancers. According to the 2017 Q1 financial report, their sales numbers are trending up — Perjeta’s by 19 percent. Roche’s R&D team is also running combination clinical trials involving Herceptin and Perjeta, as the former approaches its U.S. patent cliff.

Due to those sales and more, Roche’s overall financial picture is looking good. Optimism abounds after the approval of its new multiple sclerosis therapy Ocrevus in late March.

Prior to the approval, Evaluate Pharma estimated that Ocrevus would hit global sales of close to $4 billion in 2022.

The company is also looking ahead to a possible approval of emicizumab, following a Phase 3 readout in Q4 of this year. Emicizumab is a monoclonal antibody for hemophilia A — part of an $11 billion hemophilia market.

Roche’s share price nudged up nearly two percent following the call.

Photo: urfinguss, Getty Images