Pfizer’s top cancer drugs are small molecules, but dealmaking has expanded the pharmaceutical giant’s portfolio and pipeline with biologic medicines. Its latest deal puts the pharmaceutical giant in a camp of companies that have turned to China for the chance to develop a particular type of immunotherapy.
The drug Pfizer is licensing comes from Shenyang, China-based 3SBio. Under deal terms announced earlier this week, Pfizer is paying $1.25 billion up front for global rights to the biologic, excluding China. But the deal gives Pfizer the option to also secure the drug’s commercialization rights in China. Furthermore, the big pharma has committed to a $100 million equity investment in 3SBio.
The 3SBio drug, SSGJ-707, treats cancer by blocking two proteins. The first target is PD-1, a protein on T cells that keeps them from recognizing and fighting cancer cells. The Merck drug Keytruda one such drug of this type, a monoclonal antibody designed to block PD-1. Keytruda’s success treating cancer has turned the immunotherapy into a mega-blockbuster product.
A growing number of companies is trying to improve on PD-1 inhibition by adding another mechanism of action. 3SBio’s drug is one of them, part of an emerging group of bispecific antibodies that block PD-1 and VEGF simultaneously. The 3SBio drug is currently in clinical development in China for non-small cell lung cancer, metastatic colorectal cancer, and gynecological tumors. 3SBio plans the first Phase 3 test of this drug in China later this year.
Pfizer hasn’t been shy about opening its checkbook to get drug candidates that diversify its portfolio and deepen its pipeline, particularly in oncology. Two years ago, Pfizer paid $43 billion to acquire Seagen, which specializes in developing antibody drug conjugates (ADCs) for cancer. In a note sent to investors Tuesday, Leerink Partners analyst David Risinger wrote that the deal for the 3SBio drug is good fit for Pfizer.
“We believe SSGJ-707 dovetails well with [Pfizer’s] existing ADC portfolio and adds another important pipeline candidate to [its] oncology portfolio,” Risinger said. “However, we will need to assess its competitive differentiation given crowding in the category.”
Turning to Chinese biotech companies for promising therapeutic candidates is a hot trend, and it’s gathering pace as more companies try to get their hands on bispecific antibodies targeting PD-1 and VEGF. Summit Therapeutics is one of them with a bispecific drug in-licensed from China-based Akeso. Last year, the drug, ivonescimab, beat Merck’s Keytruda in a head-to-head test. Merck added a bispecific antibody candidate for the same targets last year, paying Shanghai-based LaNova Medicines $588 million up front for rights to LM-299, which was in Phase 1 testing in China.
BioNTech and InstilBio are both also pursuing PD-1 and VEGF with bispecific antibodies, each with a drug in-licensed from a China-based biotech company. Meanwhile, Waltham, Massachusetts-based Crescent Biopharma aims to submit an investigational new drug application by the end of this year for its internally discovered and developed bispecific antibody for PD-1 and VEGF; it’s going public in a reverse merger to finance its clinical trial plans.
Pfizer’s licensing agreement for SSGJ-707 still needs approvals from 3SBio shareholders as well as regulators. The companies expect the transaction will close in the third quarter of this year. Upon the deal’s close, Pfizer will make the $100 million equity investment in 3SBio, according to the agreement. 3SBio could receive up to an additional $4.8 billion if the drug achieves milestones. Pfizer is also responsible for paying the Chinese biotech royalties from sales of an approved product.
The location of drug manufacturing operations has become a major issue as the pharmaceutical industry braces for potential tariffs imposed on medicines and drug ingredients produced overseas. Pfizer said it plans to manufacture drug substance for SSGJ-707 at a site in Sanford, North Carolina, while the drug itself will be produced at a facility in McPherson, Kansas.
Photo: Dominick Reuter/AFP, via Getty Images
