AbbVie Ends 9-Year Nrf2 Activator Partnership with Reata, Recoups $330 Million

Compiled by Fan Dongdong

AbbVie previously spent $850 million to acquire the rights to a series of Nrf2 activators (for kidney diseases and autoimmune diseases). After nine years of operation, AbbVie recently announced the termination of its partnership with Reata Pharmaceuticals, returning these rights to Reata in the form of recovering $330 million in cash.

The collaboration between the two companies began in September 2010, when AbbVie was still part of Abbott Laboratories. At that time, the company acquired the rights to develop and market Reata’s once-daily oral Nrf2 activator, bardoxolone methyl (bardoxolone), outside the United States for $450 million. The drug was then in Phase II clinical trials for chronic kidney disease.

In the following year, AbbVie invested an additional $400 million to facilitate a global collaboration. The two parties will equally share costs and profits for each new indication, with the exception of rheumatoid arthritis and “certain other autoimmune diseases.” According to the disclosed information, AbbVie will bear 70% of the costs and profits, while Reata will assume the remaining 30%.

To regain the rights to bardoxolone, Reata will pay AbbVie $75 million by the end of this year, with the remaining balance paid in installments during 2020 and 2021. Bardoxolone is a once-daily oral Nrf2 activator that has been granted orphan drug designation by both the U.S. FDA and the European EMA for the treatment of Alport syndrome. Additionally, the FDA has granted orphan drug designation to bardoxolone for the treatment of pulmonary arterial hypertension. AbbVie stated that it will not receive any royalties from future sales of bardoxolone but will earn royalties from global sales of omavexolone and certain next-generation Nrf2 activators.

Reata’s product pipeline is based on the transcription factor Nrf2, which plays a critical role in restoring mitochondrial function, reducing oxidative stress, and blocking pro-inflammatory signaling. In 2012, Reata encountered a development setback when the Data Monitoring Committee found that patients with chronic kidney disease taking bardoxolone in its Phase III trial had an increased risk of cardiac-related adverse events, ultimately forcing the company to halt the development program for bardoxolone.

To weather the crisis, Reata halved its workforce. In 2014, the company initiated Phase II trials of bardoxolone for a new indication, pulmonary arterial hypertension (PAH), and began testing another drug, RTA 480 (omavexolone), in lung cancer, melanoma, and Friedreich’s ataxia.

Regarding the loss of AbbVie as a partner, Reata CEO Warren Huff stated that following the spin-off and other events, the development strategies of both Abbott and AbbVie have changed since the inception of their collaboration. This has resulted in a less active partnership with AbbVie in recent years; however, AbbVie still retains partial commercialization rights to our products. Therefore, this termination of the partnership may hold greater strategic significance.

Reference Source: AbbVie exits $850M Nrf2 deal with Reata, recouping $330M