Janssen is honoring its 2021 agreement with Cidara Therapeutics regarding the development of CD388, a flu prophylaxis treatment. However, Janssen has decided not to proceed with the development of CD388 itself and plans to transfer its rights and obligations under the agreement to another entity. This decision comes as Janssen is winding down its infectious disease research and development efforts.
Cidara has revealed that Janssen’s decision to proceed with CD388 triggers a $7 million milestone payment to the smaller biotech. Nonetheless, Janssen’s intention to transfer the rights to CD388 is significant news. Cidara had previously disclosed Janssen’s plan to discontinue internal development in the infectious disease field, and the agreement stipulated that once full phase 2 data were submitted to Janssen, they would have 90 days to decide on the program’s future.
Cidara’s CEO, Jeff Stein, Ph.D., emphasized that Janssen considered CD388 a flagship program in their infectious disease portfolio. Even as they exit the infectious disease space, Janssen is committed to advancing the program.
The original agreement, announced in April 2021, saw Janssen taking on late-stage development and commercialization rights for CD388. Cidara handled the phase 1 and 2 development, with Janssen taking over from there. Janssen had invested $27 million upfront, along with $753 million in R&D funding and milestone payments. Cidara stands to gain $685 million in milestone payments, in addition to potential commercial royalties.
Arrowhead Pharmaceuticals finds itself in a similar situation, awaiting Janssen’s decision on a partnered hepatitis B medication, ARO-HBV. Like Cidara, Janssen has the option to proceed with the deal or transfer the rights to another company.
Cidara shared interim phase 2 data in March, indicating that patients receiving CD388 experienced a lower viral load and reduced influenza infection rates. Full data is set to be presented at IDWeek next month, according to Stein.
Janssen intends to partner with another major pharmaceutical company to further advance CD388 as a universal flu prevention option for at-risk populations. While potential suitors have already expressed interest after Cidara’s public disclosure of its infectious disease divestments, Stein expects that Janssen can explore additional value in a new deal, considering that the original agreement was signed when CD388 was still in its preclinical stages. Janssen, however, has declined to comment on ongoing business development discussions.
