Revival in Neuroscience: Big Pharma's Renewed Interest

Biotech's innovation in neuroscience research reignites big pharma interest, with major deals like BMS's acquisition of Karuna. Myogenes' novel test for schizophrenia exemplifies this trend.

25 January 2024

Back in 2019, neuroscience was definitely not a popular area of research amongst the board rooms of the world’s leading pharmaceutical businesses. After more than ten years of disappointing but expensive clinical trials in the field, many of the largest firms in the industry announced that they would be either shutting down or significantly reducing their neuroscience research. This list included Eli Lilly, Amgen, Pfizer, GSK, AZN and Bristol-Myers Squibb, who typically cited the disappointing risk-reward ratio in neurology and the much lower success rate of drugs in development.

John Isaac, a senior director at J&J, summed up this consensus view at the time when he said,

“Internally, you have to have discussions with your non-neuroscience colleagues about why they should keep funding neuroscience,”

“You’re placing a big bet on something that potentially could be very valuable to the company and to patients, but it’s also a very high-risk activity.”

In retrospect, the problems confronting neuroscience were the same as those that some years previously had challenged oncology. These challenges were met by more research into the underlying genetics of the disease, which led to better understanding and patient stratification, which in turn led to better trial outcomes.

Although, in some respects, large pharma companies turned their backs on the sector, the neuroscience field was far from abandoned. In the biotech industry, neuroscience research has been flourishing, and it is this research effort which is now beginning to bear fruit in both neurological and neuropsychiatric conditions and, once again, to attract the interest of large pharma companies.

Bristol Myers, for example, hasn’t prioritised neuroscience research over the last decade. However, it recognises that the area presents a huge opportunity for the business, not least because of the growing population of people affected by neurological and neuropsychiatric conditions, the huge strain this puts on healthcare systems, and the unmet needs of these patient populations. In short, there is a desperate need for new treatments, and these factors have encouraged BMS to look more closely at recent scientific and technological breakthroughs in the field and back several leading biotech businesses in the area, including Prothena and Evotech.

In December 2023, BMS announced another major deal in the space, this time by acquiring Karuna Therapeutics for US$12.7bn. Karuna’s lead compound is a potential first-in-class novel treatment for schizophrenia and as an adjunctive therapy for Alzheimer’s disease psychosis. Karuna’s new drug application for KarXT for the treatment of schizophrenia in adults was accepted for review by the FDA and has a PDUFA date in September 2024.

Elsewhere in the sector, Merck acquired Caraway Therapeutics in a US$610mn deal in November last year. Merck had been a shareholder in Caraway through its Ventures Fund. Caraway has a preclinical pipeline of therapies for neurodegenerative diseases, including Parkinson’s disease, focusing on lysosomal dysregulation. Interestingly, Curated was in discussions with Caraway to help the business raise capital before this transaction.

Finally, in another big neuroscience transaction in December, Abbvie announced the acquisition of Cerevel Therapeutics for US$8.7bn. Cerevel, founded as recently as 2018, is a clinical-stage drug development business focused on advancing a pipeline of small molecule therapies to treat Parkinson’s disease, epilepsy, and schizophrenia. Abbvie commented that the acquisition of Cerevel would complement its existing neuroscience portfolio, adding a number of potentially best-in-class assets that could transform standards of care across a range of psychiatric and neurological disorders where there is significant unmet patient need.

These deals represent growing interest in this neglected area of drug development, which in the past was probably in the “too difficult” category of medical research but is now more accessible following significant advances in understanding the complex biological processes in neuroscience.

We think this rapidly growing and broad interest in neuroscience bodes well for Myogenes, one of the healthcare companies Curated is currently representing.

Myogenes has developed a unique, first-in-class pharmacogenetic test designed to give clinicians treating refractory schizophrenia (Treatment-Resistant Schizophrenia - TRS) vital information about if, when, how and at what dose clozapine should be prescribed for their patients. Currently, clozapine, the only approved and effective therapeutic for refractory schizophrenia patients, is grossly underutilised across the world. This has created a global crisis in the treatment of this serious mental illness, causing significant suffering in the patient population, distress for the people who care for these patients and funding challenges for the health systems that have to pay for their care.

This is because clinicians are fearful of the side effects of clozapine use, which can, in rare circumstances, be fatal, and their inability to anticipate and manage them safely. Appropriate dosing is also a huge challenge to the prescribing community because of the huge variability in the level of starting and target doses in the patient population. The Myogenes clozapine pharmacogenetic test provides answers to all of these critical questions and puts clinicians that use it in a far better place to treat their refractory schizophrenia patients, benefitting them, their families and carers, and the health systems that pay for their care. For the first time, this pharmacogenetic test brings personalised, precision medicine to this area of mental health and enables clinicians to confidently move away from a guesswork-based, one-size-fits-all approach to treating refractory schizophrenia.

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