Johnson & Johnson Terminate Agreements with Orexo
Sweden’s Orexo suffered a major setback yesterday after the announcement that Johnson & Johnson had decided to end the firms’ anti-inflammatory collaboration.
The agreement with the healthcare company’s Janssen Pharmaceuticals unit aligned around two research projects in the arachidonic acid field. The OX-CLI and OX‑ESI programmes were concentrated on developing treatments for asthma, chronic obstructive pulmonary disease and other inflammatory diseases.
Another third undisclosed Janssen programme has also been terminated by Johnson & Johnson, and each company has reclaimed all commercial rights for their respective projects. Anders Lundstrom, Orexo’s chief executive, commented that Johnson & Johnson’s decision is to terminate the collaboration is “obviously a disappointment to us” and “unfortunately, we lack the funds to continue on our own to develop the OX-CLI and OX‑ESI projects and have therefore decided to close them down.”
The original pact, signed in June 2010, could have been valued at around $600 million to the Swedish drug maker. The collaboration was originally meant to run for three years, in which Orexo would receive research backing of up to $21.5 million, including an upfront payment of $10 million from Janssen.
Meanwhile, Orexo have publicised their financials for 2011, which revealed that revenues slipped to 199.6 million Swedish kroner (about $29.3 million) from 210.5 million kroner. Net loss was 392.0 million kroner and the company finished the year with cash and equivalents of 246.9 million kroner.
Growth within the company is currently being driven by cancer pain drug Abstral (fentanyl), which is sold by Scotland’s ProStrakan. Royalty revenues for the year increased by 67% in 2011 to 70.5 million kroner. Mr Lundstrom noted that the US Food and Drug Administration (FDA) decided in December to approve a common risk management system for all fast-acting fentanyl products, “which means that Abstral, for the first time, will be able to compete on equal terms with other fast- acting fentanyl products in the US market”.