Bristol-Myers Squibb announces acquisition, collaboration

NEW YORK & SAN CARLOS, Calif.—Bristol-Myers Squibb Co. and Flexus Biosciences Inc. have struck a definitive agreement by which Bristol-Myers Squibb will acquire all of Flexus' outstanding capital stock in a deal with a potential total consideration of $1.25 billion, which includes $800 million up front and up to $450 million in development milestone payments. Both companies' boards of directors have approved the transaction, as have Flexus' stockholders. The transaction is expected to close in Q1 2015, with the closing subject to customary closing conditions, including Hart-Scott-Rodino Act clearance.

“Bristol Myers Squibb is a recognized leader in the cancer immunotherapy field, and we are delighted with the opportunity to have their organization advance the development of our potentially best-in-class IDO/TDO inhibitors and to bring more innovative cancer immunotherapies to patients,” Dr. Terry Rosen, CEO of Flexus, said in a press release. “With the consummation of this acquisition, we will continue to advance our oncology and immuno-oncology pipeline of Agents for Reversal of Tumor Immunosuppression in the newly created spin-off, with the strong support of our committed group of investors.”

IDO and TDO are enzymes expressed by a number of tumor cells and cells in the tumor microenvironment, and these enzymes suppress T cell function through the production of kynurenine, a potent immunosuppressive factor that prevents the immune system from identifying and destroying the tumors. IDO/TDO inhibitors reduce the production of kynurenine, freeing up the immune system to better attack tumors. With this acquisition, Bristol-Myers Squibb gains full rights to F001287, Flexus' lead preclinical small-molecule IDO1-inhibitor, which is aiming for Investigational New Drug filing in the second half of this year. Bristol-Myers Squibb also gets Flexus' IDO/TDO discovery program, which includes the company's IDO-selective, IDO/TDO dual and TDO-selective compound libraries.

Per the terms of the agreement, a newly formed entity established by Flexus' current shareholders will retain all non-IDO/TDO Flexus assets, including those related to Flexus’ Phase 1 FLT3 and CDK4/6 inhibitor, its earlier-stage small-molecule Treg cancer immunotherapy programs and its current personnel and facilities.

“Bristol-Myers Squibb is committed to leading scientific advances in immuno-oncology and our acquisition of Flexus will expand our innovative pipeline with an important approach to enhancing immune responses in cancer,” said Francis Cuss, MB BChir, FRCP, executive vice president and chief scientific officer at Bristol-Myers Squibb. “With the addition of a potentially best-in-class IDO1 inhibitor and the broad IDO/TDO programs, Bristol-Myers Squibb will accelerate its ability to explore numerous immunotherapeutic approaches across tumor types, including combinations with our biologic checkpoint and co-stimulatory agents that target different and complementary pathways.”

Bristol-Myers Squibb simultaneously announced a collaboration agreement with Rigel Pharmaceuticals Inc. to discover, develop and commercialize cancer immunotherapies based on Rigel's portfolio of small-molecule TGF beta receptor kinase inhibitors. Per the agreement, Bristol-Myers Squibb will gain exclusive, worldwide rights to develop and commercialize small-molecule therapeutics derived from Rigel's TGF beta library, including—but not limited to—those approved to treat cancer. Bristol-Myers Squibb will pay Rigel $30 million up front, and the latter will also be eligible to receive development and regulatory milestone payments that could total more than $309 million, should a successful compound gain approval in multiple indications. Rigel also stands to receive tiered royalties on the net sales of any products resulting from this collaboration.