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Redx Pharma strikes balance between in-house programmes and partnerships

The company has announced two partnerships in a month but continues to focus on its own projects

Redx Pharma PLC - Redx Pharma strikes balance between in-house programmes and partnerships

Redx Pharma PLC (LON:REDX) is comfortable after having found a balance between in-house programmes and partnerships with other companies.

This week the biotech announced a collaboration, the first of this kind since its creation in 2010, with US company Jazz Pharmaceuticals to discover and develop two targeted cancer therapies.

READ: Redx Pharma unveils second major collaboration in a month as it strengthens ties with Jazz Pharmaceuticals

Redx will receive US$10mln upfront, a further US$10mln in year-two, and US$400mln in milestone payments and tiered royalties.

The news came just a month after a licensing deal for a novel fibrosis treatment with pharma giant AstraZeneca PLC (LON:AZN) that saw shares rocketing twice their value.

Meanwhile, the AIM-listed firm continues to pursue its own programmes, namely RXC004 and RXC007.

The former is a cancer treatment already in the clinic, while trials for the latter, designed for fibrosis patients, are scheduled for 2021.

“We need to balance our portfolio as always we don’t want to be reliant on one single programme, I think it’s evidenced in the choices that we’ve made,” chief executive Lisa Anson told Proactive on the phone.

“I am very comfortable with the position we have now with the two programmes with Jazz and we may look at other collaborations with the right partner, but equally we may just prosecute with our own programme.”

The Jazz project

The deal with Jazz builds upon an existing working relationship, as the UK group sold its pan-RAF inhibitor programme to Nasdaq-listed Jazz last July for US$3.5mln upfront and US$203mln in milestones and royalties.

“This new agreement reinforces Redx's strong position as a successful research partner and its expertise in medicinal chemistry and drug design,” Anson said.

Redx will lead the discovery of two drugs against two cancer targets on the Ras/Raf/MAP kinase (MAPK) pathway.

The junior pharma player will prepare the compounds up to Investigational New Drug (IND) submission, in a process that may take between 18 months and five years.

Jazz will take over thereafter and assume responsibility for regulatory and commercialisation steps.

The competition

The MAPK pathway is a competitive area already studied by several companies, so Redx has selected two new targets to investigate and chose not to disclose them.

For example, GlaxoSmithKline PLC’s (LON:GSK) trametinib targets a mutant protein happening in 50% of skin cancers by inhibiting the MAPK signalling pathway. It was approved in the US in 2013.

Last year, AstraZeneca was granted priority review for its Selumetinib candidate for nerve tissue tumours in patients aged above three years old.

According to Anson, the new collaboration with Jazz shows their previous partnership went well and Redx’s discovery capability sparks interest in the sector.

Having developed five molecules in the past five years is “a very successful discovery track record” by any standards, she said.

“We see this as an opportunity to leverage that capability by adding another research programme where we are effectively sharing the risk and the reward in addition to the programmes and targets we will continue to develop,” Anson added.

“For a number of reasons I think this is a very good deal for Redx.”

Shares in Redx were trading 4% higher at 67.7p on Friday afternoon, having soared 746% in the year to date.

Quick facts: Redx Pharma PLC

Price: 65 GBX

AIM:REDX
Market: AIM
Market Cap: £126.91 m
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