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Flexion Therapeutics to acquire novel and non-opioid asset for osteoarthritis of knee

Published 14 December 2017

Flexion Therapeutics has entered into a definitive agreement with GeneQuine Biotherapeutics GmbH to acquire the global rights to GQ-203.

As part of the agreement, Flexion obtained an exclusive license to the underlying intellectual property rights for human use of GQ-203 from Baylor College of Medicine. GQ-203, now known as FX201, is a preclinical, non-opioid, intra-articular therapeutic being developed for symptomatic pain relief and disease modification in patients with osteoarthritis (OA) of the knee.

As part of the deal, Flexion will make an upfront payment of $2 million to GeneQuine and may incur milestone payments of up to $8.7 million through Phase 2 proof of concept (PoC). Following successful PoC, Flexion may incur up to $54 million in future development and global regulatory approval milestone payments, with Baylor also receiving a low single-digit royalty on net sales of FX201.

After taking into account Flexion's payment obligations in connection with the acquisition and the anticipated preclinical and clinical development costs for FX201, the company still expects current cash to bring Flexion to profitability.

FX201 is a locally administered gene therapy designed to stimulate the production of an anti-inflammatory protein, interleukin-1 receptor antagonist (IL-1Ra), whenever inflammation is present within the joint.

Inflammation is a known cause of pain, and chronic inflammation is thought to play a major role in the progression of OA. By persistently suppressing inflammation, FX201 may both reduce pain and modify the disease.

"We believe FX201 could represent a next-generation therapeutic approach for OA, and it supports our long-term objective of having a pipeline of high-quality drug candidates that are positioned to enter the market as ZILRETTATM matures," said Michael Clayman, M.D., President and Chief Executive Officer of Flexion.

 "With its potential to deliver an unprecedented duration of pain relief and possibly arrest the progression of disease, FX201 could transform the treatment of OA, while fitting nicely within our commercial infrastructure."

Based on strong preclinical data, a single injection of FX201 could potentially enable expression of IL-1Ra in an osteoarthritic joint for a least a year. Initially, FX201 will be targeted towards a subpopulation of patients who confront aggressive OA of the knee and would be expected to differentially benefit from this therapy.

Flexion expects to hold a pre-Investigational New Drug meeting with the U.S. Food and Drug Administration in the first half of 2018, and pending successful results from preclinical studies, the company aims to initiate a Phase 1 clinical trial in 2019.

OA is the most common joint disease, affecting more than 30 million Americans and accounting for more than $185 billion in annual expenditures. In 2016, more than 15 million Americans were diagnosed with OA of the knee and the average age of physician-diagnosed knee OA has fallen by 16 years, from 72 in the 1990s to 56 in the 2010s.

The prevalence of OA is expected to continue to increase as a result of aging, obesity and sports injuries. Each year, more than 15 million Americans are treated for OA-related knee pain, and approximately five million OA patients receive either an immediate-release corticosteroid or hyaluronic acid intra-articular injection to manage their knee pain.



Source: Company Press Release