Biogen Acquires Nightstar Therapeutics for $877 Million to Reshape the Choroideremia Market Landscape

VCBeat (WeChat Official Account: vcbeat) has learned that on March 4, 2019, Biogen announced the acquisition of Nightstar Therapeutics’ gene therapy platform for $877 million (€772 million). This acquisition will enable Biogen to secure ophthalmic gene therapy technologies, helping the company gain a competitive edge and bring exclusive gene therapies to market ahead of schedule.

Since its spin-out from the University of Oxford in 2013, Nightstar Therapeutics has advanced two gene therapies for retinal indications through venture capital financing and an initial public offering (IPO). The company’s lead candidate, NSR-REP1, is currently in Phase III clinical trials, with patient enrollment for choroideremia—a rare retinal disease with no existing cure—expected to be completed in the coming months. The trial aims to evaluate whether NSR-REP1 can treat progressive vision loss that is currently incurable. Notably, during its early development stages, Nightstar Therapeutics also developed a gene therapy targeting X-linked retinitis pigmentosa (XLRP).

Biogen had previously expressed interest in researching gene therapies for ocular diseases, such as choroideremia and X-linked retinitis pigmentosa (XLRP), and entered into a $124 million collaboration agreement with AGTC. However, after encountering clinical setbacks last year, the major biotechnology company terminated its partnership with AGTC, although Biogen’s interest in this field remains undiminished.

Biogen CEO Michel Vounatsos stated, “Ophthalmology is an emerging growth area for Biogen. Nightstar Therapeutics will accelerate our entry into ophthalmology by providing two mid-to-late stage gene therapy assets.”

Biogen acquired Nightstar Therapeutics at a price of $25.50 per share. This represents a 70% premium over the volume-weighted average share price during the preceding 30 trading days, but is below Nightstar Therapeutics’ peak stock price last September. The decline in the stock price began when Nightstar Therapeutics released conceptual and experimental data for its XLRP candidate product and conducted a share offering. The study found that one-third of patients receiving high-dose NSR-REP1 experienced disease alleviation, while the therapeutic effect was more pronounced in patients receiving low-dose NSR-REP1.

These mixed data have raised questions: Why did Nightstar Therapeutics observe an inverse dose-response relationship, yet still stand a chance to bring its XLRP therapy to market ahead of competitors AGTC and MeiraGTx? In fact, Nightstar Therapeutics remains in a favorable position in the competition for the choroideremia market, given that its strongest rival, Spark Therapeutics, has not yet advanced its drug into Phase II trials.

However, Spark Therapeutics already has experience bringing gene therapies for eye diseases to market. Once it finalizes a $4.3 billion acquisition deal with the Swiss pharmaceutical company Roche, Spark Therapeutics will gain Roche’s support and is poised to outpace its competitors.

The successive acquisitions of Spark Therapeutics and Nightstar Therapeutics will turn the competition in the choroideremia market into a fierce battle between Roche and Biogen, while further reshaping the broader gene therapy landscape. In the past, gene therapy was largely a domain where small biotech companies collaborated with pharmaceutical firms, but this dynamic is changing as Novartis, Roche, and now Biogen pursue more aggressive acquisition strategies in the field.

(Compiled by Ning Chen)