Gilead Sciences announced the acquisition of Phenex Pharmaceuticals' Farnesoid X Receptor program which uses FXR agonists for treating liver diseases like nonalcoholic steatohepatitis (NASH). While nowhere near the $11-billion buyout of Pharmasset, Gilead's most recent investment has the potential to become a big hit.
A common and unfortunately serious form of chronic liver disease, NASH is characterized by excessive accumulation of fat and inflammation in the liver, leading to liver failure, cirrhosis and progressive fibrosis. An estimated 10 to 20 percent of the population in developed countries is affected by the disease and no treatments yet have been approved for addressing NASH. A nuclear hormone receptor, Phenex's FXR is designed to regulate the production of bile acid and promote glucose and lipid homeostatis, reducing inflammation and liver steatosis which may help in preventing liver fibrosis.
"After 15 years of research, FXR is now one of the few clinically validated targets for NASH and we are delighted that Gilead will be continuing the research necessary to more fully realize its potential for advanced liver disease," said Dr. Claus Kremoser, chief executive officer for Phenex Pharmaceuticals.
According to Norbert Bischofberger, chief scientific officer and executive vice president for Research and Development for Gilead Sciences, the acquisition is an important opportunity that will accelerate the company's efforts at developing treatment options geared towards addressing fibrotic liver disease. He adds that Gilead Sciences is looking forward to working with Phenex in advancing the FXR program, achieving clinical development swiftly to draw out the program's full potential.
It remains to be seen if the FXR program will undoubtedly become a blockbuster drug for Gilead Sciences but with up to 5 percent of Americans living with chronic liver disease, there certainly is a market for the treatment in the United States. At the very least as well, going for Phenex's FXR program for NASH was the more cost-effective choice instead of pursuing Intercept Pharmaceuticals' obeticholic acid.
Back in 2011, Gilead Sciences shocked the biotech world by buying Pharmasset for what Wall Street observers thought was an exorbitant amount. Pharmasset's hepatitis C drug Sovaldi was approved by the U.S. Food and Drug Administration in 2013 and for its first nine months went on to generate $8.5 billion in revenues.
Given the market potential that the FXR program has, most especially if Gilead Sciences could be the first to release an approved treatment for NASH, its investment in Phenex will definitely appear like chump change.
