Lundbeck is slashing the book value of its $250 million Abide Therapeutics buyout in response to phase 1 data that triggered an early end to a pain program.
Denmark’s Lundbeck bought Abide in 2019, paying $250 million in cash and committing $150 million in milestones to take control of a phase 2a Tourette syndrome trial, a discovery platform and a West Coast research hub. Lundbeck stopped pursuing Tourette, an indication an exec later called “a little optimistic,” in 2020 but kept going after conditions in which it believed MAGL inhibition was a better fit.
Now, Lundbeck has acknowledged a bigger setback to the Abide acquisition. The company is taking a 547 million Danish krone ($79 million) write-down on the Abide platform. Joerg Hornstein, Lundbeck’s chief financial officer, said at the company’s capital markets day that the value was 1 billion Danish kroner.
The reappraisal of the value of the acquired assets follows a setback to a pain program. Johan Luthman, executive vice president of R&D at Lundbeck, framed the decision to stop development of Lu AG06474 as part of the company’s ethos of “letting the molecule speak.” Here’s how the conversation went.
“It was a peripherally restricted molecule that we explored in a nice set of very decisive pain studies. The molecule told us, ‘we don't like this,’ so we stopped that program,” Luthman said. “There are still MAGLi inhibitors in clinical development. That program has not ended overall.”
ClinicalTrials.gov lists three studies of Lu AG06474 that enrolled healthy volunteers. One of the studies, which finished earlier this year, compared the effects of the candidate to ibuprofen and pregabalin on a battery of evoked pain tests. Lu AG06474 was part of a broader MAGL program.
Lundbeck renamed the former Tourette candidate Lu AG06466 after acquiring Abide. From 2020 to 2022, the company started 11 phase 1 trials of that inhibitor of MAGL, an enzyme that drives the degradation of an endocannabinoid. The phase 1 trials evaluated Lu AG06466 in fibromyalgia, focal epilepsy, multiple sclerosis, post-traumatic stress disorder and healthy volunteers. All of those trials are either completed or terminated.
Roche has also identified the potential to treat multiple sclerosis by inhibiting MAGL. The drugmaker’s phase 1 pipeline includes a MAGL inhibitor, RG6182, that the company said could tackle accumulation of persistent neurological disability in the chronic neurological disorder.