Otsuka Pharmaceutical Co., Ltd. (Otsuka) and Jnana Therapeutics
Inc. (Jnana) today announced that they have entered into a
definitive merger agreement pursuant to which Otsuka will acquire
Jnana, making it a wholly owned subsidiary through Otsuka’s
100-percent owned subsidiary, Otsuka America, Inc. (OAI). The
acquisition is expected to be completed in the third quarter of
fiscal 2024, subject to customary closing conditions.
Based on the terms of the agreement, Otsuka will
pay USD $800 million to the shareholders of Jnana upon completion
of the acquisition, as well as up to an additional USD $325 million
in development and regulatory milestones.
1.Reasons for the acquisition
Jnana’s novel approach to drug discovery is
enabled by RAPID – the company’s next-generation chemoproteomics
platform designed to discover medicines for highly validated but
challenging-to-drug targets. The platform leverages a
high-throughput, binding-based screening approach that is
inherently flexible, enabling the discovery of binding sites across
the surface of a target protein and the identification of small
molecules that elicit diverse pharmacologies. Jnana has
used RAPID to successfully identify first-in-class
compounds and address a range of historically challenging-to-drug
target classes, including solute carriers, transcription factors,
and signaling scaffold proteins. Jnana pursues drug discovery based
on concepts that are complementary to those of Astex
Pharmaceuticals, a subsidiary of Otsuka based in Cambridge, UK.
While Jnana's RAPID platform is not limited to
any specific therapeutic area, the company has built a unique
competitive position by concentrating on PKU, a rare inherited
metabolic disorder in which phenylalanine accumulates to abnormally
high levels in the blood, and autoimmune diseases, where small
molecule drug discovery has been challenging. Jnana’s technology
successfully generated JNT-517, an allosteric small molecule
inhibitor of SLC6A19, an SLC (solute carrier) that regulates amino
acid reabsorption in the kidney. JNT-517 has the potential to
become a first-in-class oral treatment for PKU, as it has been
shown to be effective, well-tolerated, and safe in a Phase 1b/2
study. A majority of the PKU population is not effectively treated
with existing therapies, and JNT-517 is an approach that could
address individuals of all ages across the spectrum of mild to
severe disease.
In the autoimmune disease field, the company is
pursuing small molecule drug discovery for highly validated, but
challenging-to-drug, targets such as interferon regulatory factor 3
(IRF3), a master transcription factor for the production of
interferon.
Otsuka has advanced contributions to patients
with a wide range of rare diseases, not only in the renal area with
JINARC (approved for autosomal dominant polycystic kidney disease),
sibeprenlimab (IgA nephropathy), and voclosporin (lupus nephritis),
but also by adding new specialty drugs such as donidalorsen
(hereditary angioedema). Additionally, through Visterra, a
Boston-based company that Otsuka acquired in 2018, Otsuka is
advancing research and development in the autoimmune field using
antibody drug technology, while also expanding its drug discovery
platform.
Makoto Inoue, president and representative
director of Otsuka Pharmaceutical commented, "I am gratified that
Otsuka has entered into an agreement with Jnana. The addition of
Jnana's drug discovery technology and small molecule pipeline in
PKU and autoimmune diseases will strengthen our R&D in the
Boston area of the U.S., one of the most important bioclusters in
the world, and in a combined form will have a synergistic effect on
Otsuka Pharmaceutical's global expansion.”
Joanne Kotz, Ph.D., CEO and co-founder of Jnana,
commented, "This transaction recognizes the Jnana team’s
accomplishments since the founding of the company, which include
creating RAPID – a world-class small molecule drug discovery
platform. Leveraging our platform, the team discovered JNT-517, a
potential first-in-class oral medicine for the treatment of PKU,
and has demonstrated positive clinical proof of concept for JNT-517
in individuals with PKU. We are excited to join Otsuka with our
shared goal of developing transformative therapies for patients and
look forward to advancing JNT-517 into a registrational study in
2025 and continuing to progress our pipeline of innovative oral
medicines for autoimmune diseases."
2.Outline of the acquisition
Upon completion of the acquisition, Jnana will
operate as a wholly owned subsidiary of Otsuka in Boston and will
continue its research and development. The acquisition will be
implemented by merging a special purpose company, established under
OAI for this acquisition, into Jnana Therapeutics, with Jnana
remaining as the surviving company. Existing shareholders of Jnana
will be paid cash as consideration for this merger. Although the
Boards of Directors of both Otsuka and Jnana have approved this
acquisition, the execution of this acquisition may require the
approval of Jnana's shareholders and the fulfillment of conditions
under U.S. antitrust laws. After completion of necessary
procedures, we aim to complete the acquisition during the third
quarter of 2024.
3.Additional information about Otsuka
(https://www.otsuka.co.jp/en/)
Otsuka Pharmaceutical Co., Ltd. is a global
healthcare company with the corporate philosophy: Otsuka–people
creating new products for better health worldwide. Otsuka
researches, develops, manufactures, and markets innovative
products, with a focus on pharmaceutical products to meet unmet
medical needs and nutraceutical products for the maintenance of
everyday health.In pharmaceuticals, Otsuka is a leader in the
challenging areas of mental, renal, and cardiovascular health and
has additional research programs in oncology and on several
under-addressed diseases including tuberculosis, a significant
global public health issue. These commitments illustrate how Otsuka
is a “big venture” company at heart, applying a youthful spirit of
creativity in everything it does.
4.Additional information about Jnana
(https://www.jnanatx.com/)
Jnana Therapeutics is a clinical-stage
biotechnology company leveraging its next-generation RAPID
chemoproteomics platform to discover medicines for highly
validated, challenging-to-drug targets to treat diseases with high
unmet needs. Jnana is focused on developing first- and
best-in-class therapies to treat a wide range of diseases,
including rare diseases and immune-mediated diseases. Jnana’s lead
program, JNT-517, which targets an allosteric site on the
phenylalanine transporter SLC6A19, is a potential first-in-class
oral approach for the treatment of PKU, a rare genetic metabolic
disease. Located in Boston, Jnana brings together scientific
leaders in small molecule drug discovery and development, a highly
experienced management team, and the backing of leading life
science investors Bain Capital Life Sciences, RA Capital
Management, Polaris Partners, Versant Ventures, Avalon Ventures,
Pfizer Ventures, and AbbVie Ventures.
5.Advisors
Centerview Partners LLC acted as financial
advisor to Jnana and Latham & Watkins LLP acted as its legal
advisor.
Media Contacts
For Otsuka Pharmaceutical:
Jeffrey Gilbert
gilbert.jeffrey.a@otsuka.jp
For Jnana Therapeutics:
Adam Silverstein
adam@scientpr.com