The art of the health deal: How strong data opens doors

• Strong clinical data can help biotechs secure lucrative licensing and partnership deals 
• Dimerix has four licensing deals for lead drug DMX-200 in rare kidney disease
• Platinum’s Global Health Sciences Fund manager Dr Bianca Ogden notes several major sector deals, particularly overseas.

Strong clinical data doesn’t just move share prices – it can unlock lucrative global licensing deals for ASX-listed healthcare companies.

In recent years, companies such as Dimerix (ASX:DXB) and Neuren Pharmaceuticals (ASX:NEU) have shown how compelling trial results can draw in deep-pocketed partners, accelerate commercialisation and transform a pipeline.

Dimerix has secured four lucrative licensing deals across key territories for its lead compound DMX-200, a small-molecule chemokine receptor 2 (CCR2) inhibitor in a phase III trial for the rare kidney disease focal segmental glomerulosclerosis (FSGS).

In 2024 the company reported positive interim results for the trial titled Angiotensin II Type 1 Receptor (AT1R) & Chemokine Receptor 2 (CCR2) Targets in Inflammatory Nephrosis, or ACTION3 for short.

FSGS is a rare disease that causes kidney scarring that can lead to progressive end-stage kidney failure, requiring dialysis or transplant. The disease affects adults and children as young as two with no approved treatments currently available.

As a result, DMX-200 has received orphan drug designation (ODD) in the US and Europe, and the equivalent innovative licensing and access pathway (ILAP) status in the UK.

Dimerix’s first licensing deal with ADVANZ Pharma was announced in October 2023, covering the European Economic Area, UK, Switzerland, Canada, Australia and New Zealand for commercialisation of DMX-200 for the treatment of FSGS following regulatory approval.

A second licensing deal with Taiba Middle East was announced in May 2024 for several Middle Eastern countries including the United Arab Emirates (UAE), Saudi Arabia, Oman, Kuwait, Qatar, Bahrain and Iraq.

Dimerix announced a third deal to develop and commercialise DMX-200 in Japan to treat FSGS with Fuso Pharmaceutical Industries in January 2025.

The company then announced a deal in July with Nasdaq-listed Amicus Therapeutics to commercialise its lead drug candidate DMX-200 in the US.

Additionally, Amicus has exclusive rights to develop DMX-200 in other future indications in the US, the world’s largest healthcare market.

Under the four deals Dimerix may be eligible for up to ~$1.4 billion in total upfront payments and potential milestone payments, plus royalties on net sales, with more than $65 million in total payments already being received.

The company continues to pursue licensing opportunities with potential partners in territories not already licensed.

“Achieving commercial partnerships across key territories further validates the technology and market potential [of DMX-200],” Webster said.

“Aside from the financial benefits, our partners have exponentially grown our expertise across all sectors, including clinical, regulatory, pricing, reimbursement, manufacturing and distribution.

“This reduces risk for our investors, and shares risk with our new partners.”

Deal with Acadia transforms Neuren

Neuren has leveraged its clinical successes into one of the most lucrative licensing arrangements seen for an Australian biotech.

Its deal with Nasdaq-listed Acadia Pharmaceuticals is for trofinetide (marketed in the US as DAYBUE), a treatment for the rare genetic disease, Rett syndrome.

The original North American licence, struck in August 2018, included a US$10m up-front payment with up to US$455m in milestone payments plus royalties on trofinetide sales in the region.

Following FDA approval of trofinetide for Rett syndrome in March 2023, Acadia acquired the global rights to the drug and to Neuren’s second candidate NNZ‑2591 for Rett and Fragile X syndromes – in a deal worth hundreds of millions of dollars.

“The original Acadia deal was enabled by our landmark Phase 2 trial data and the expanded deal followed FDA approval that was based on strong Phase 3 trial data,” CEO and managing director Jon Pilcher told Stockhead.

“The deals and FDA approval turned Neuren from a clinical-stage biotech into a partnered, revenue-generating company.”

‘The art of the deal’

Long-term portfolio manager for Platinum Asset Management’s International Health Sciences Fund Dr Bianca Ogden said deals were happening in the sector, particularly in overseas markets.

“It comes down to how hot a disease indication or therapeutic modality is and what clinical data exists that makes a deal attractive” she said.

Big Pharma Pfizer and Novo Nordisk have been battling it out this year over the acquisition of obesity drug-focused Metsera, which is working on a long-acting GLP1 drug. With counterbids and lawsuits Pfizer ultimately secured New York-based Metsera for US$10 billion.

In June Bristol Myers Squibb inked a deal with Germany’s BioNTech to co-develop that company’s next-generation cancer immunotherapy, a bispecific antibody that targets PD-L1 and VEGF-A. Ogden said this approach was in high demand as it may challenge Merck’s Keytruda.

Deal terms were competitive with BioNTech receiving $1.5bn upfront with more milestone payments to come that could add up to $11bn.

“The deal structure is for co-development, co-commercialisation and 50/50 profit share which is sensible given the complementary skill sets of the two companies” Ogden said.

“Sometimes partnerships start and then discussions move to M&A and we are seeing that more now with big money being deployed.”

She said in cases like Dimerix they had an indication which was of interest along with a rare disease classification.

“Kidney disease is something that attracts attention these days, along with rare diseases,” Ogden said.

“It’s the art of the deal and often many aspects have to come together at once to pull off a deal.

“Clinical data has to come from well designed clinical trials and the commercial setup needs to be there to entice a partner.

“Then there needs to be an alignment of deal terms and smaller companies have to have the bandwidth to deal with an onslaught of due diligence questions”.

Race positions for deal opportunities

Race Oncology (ASX:RAC) is positioning its next-generation bisantrene formulation RC220 for partnerships and licensing, leveraging the active (E,E)-bisantrene isomer (RCDS1) and its combined cardioprotective and anticancer potential.

This year, Race achieved two major IP breakthroughs it said “fundamentally change” its commercial outlook.

First, the company filed three patent applications covering the chemical structure (composition-of-matter), manufacture, formulation, storage and therapeutic uses of the active isomer and isomeric mixtures.

Composition-of-matter patents are the most valuable form of pharmaceutical IP and provide the strongest protection for the active drug.

If granted, the new patents could extend protection for the active (E,E)-bisantrene isomer to 2045, securing the clinically active version of the drug.

Bisantrene was originally developed in the 1970s and 1980s by Lederle Laboratories aimed at being a less cardiotoxic alternative to anthracyclines, but poor solubility in the blood limited its use and development was halted despite encouraging anticancer activity.

Race has overcome the blood solubility issue through reformulation and shown that RC220 can prevent anthracycline-induced cardiotoxicity and enhance anticancer activity.

Race also identified, for the first time, how (E,E)-bisantrene works, finding it binds to cancer-linked structures in DNA and RNA called G-quadruplex, which can shut down key cancer growth pathways, further strengthening RC220’s scientific and commercial case.

The company has multiple clinical programs underway and has announced plans for two new trials, a Phase III trial in Acute Myeloid Leukemia (AML), and a Phase 1a/b trial in non-small cell lung cancer, based on this G-quadruplex binding mechanism of action.

CEO and managing director Daniel Tillett told Stockhead Race was actively reviewing partnership options to maximise shareholder value.

“Discovering how (E,E)-bisantrene works has opened up many opportunities to use bisantrene in a range of different cancers,” he said.

“Pharma partners want to see a number of key features in any new drug before considering partnering or acquiring – high quality preclinical and clinical data, a known and ideally unique mechanism of action, excellent clinical efficacy and safety, large market potential, and a long period of robust IP protection.

“We are in the extremely lucky position of having all these features now in (E,E)-bisantrene and RC220.”

The views, information, or opinions expressed in the interview in this article are solely those of the interviewee and do not represent the views of Stockhead.

Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.

At Stockhead, we tell it like it is. While Dimerix and Race Oncology are Stockhead advertisers, the companies did not sponsor this article.