Johnson & Johnson may be looking to deepen its relationship with immunology partner Protagonist Therapeutics with a takeover deal, The Wall Street Journal reports.
The exact details of the talks aren’t yet known, but a deal would likely value Protagonist well above its market value of over $4 billion as of Thursday’s close, the report notes.
Protagonist’s shares flew up more than 30% to around $88 per share as of Friday afternoon.
J&J and Protagonist’s 2017 collaboration sparked icotrokinra, a much-anticipated targeted oral peptide designed to selectively block the interleukin-23 (IL-23) receptor. The drug candidate is up for both FDA and European review in plaque psoriasis and is also being studied in psoriatic arthritis and ulcerative colitis.
Last month, icotrokinra proved that it may have what it takes to hold its own in the crowded immunology market with a win over Bristol Myers Squibb’s oral psoriasis champion Sotyktu. Analysts have propped the med up as a potential blockbuster across its various indications, with Jefferies analysts estimating peak sales of $7.5 billion in the U.S. alone.
J&J has exclusive commercialization rights to the med according to the partners’ agreement, which was expanded in 2021.
Last year, Protagonist added another character to its story with Takeda’s $300 million bet on its blood disorder med rusfertide.
The drug candidate, which J&J would also get its hands on through a potential acquisition of Protagonist, succeeded in reducing blood procedures in patients with polycythemia vera during a phase 3 trial.
J&J has a broad hematology profile across several blood cancers, but does not have as much to offer in the way of rare blood disorders that rusfertide targets. Taking on both of Protagonist’s clinical pipeline assets would expand its horizons and add some extra padding to its immunology business as top-selling Stelara faces the impacts of recent generic competition.
A Protagonist deal would follow the M&A theme that J&J opened the year with. For a whopping $14.6 billion, the Big Pharma firm bought out Intra-Cellular and its schizophrenia and bipolar treatment Caplyta.