- Sierra Oncology’s differentiated momelotinib has the potential
to address the critical unmet medical needs of myelofibrosis
patients with anaemia
- Momelotinib complements GSK’s existing expertise in
haematology, with Sierra Oncology anticipating US regulatory
submission in Q2 this year and EU submission in the second half of
2022
- Sales contribution expected to start in 2023 with significant
growth potential thereafter
- Supports development of strong portfolio of new specialty
medicines and vaccines
GlaxoSmithKline plc (LSE/NYSE: GSK) and Sierra Oncology, Inc
(Nasdaq: SRRA) today announced that the companies have entered into
an agreement under which GSK will acquire Sierra Oncology, a
California-based, late-stage biopharmaceutical company focused on
targeted therapies for the treatment of rare forms of cancer, for
$55 per share of common stock in cash representing an approximate
total equity value of $1.9 billion (£1.5 billion).
Myelofibrosis is a fatal cancer of the bone marrow impacting the
normal production of blood cells. Anaemia represents a high unmet
medical need in patients with myelofibrosis. At diagnosis,
approximately 40% of patients are already anaemic, and it is
estimated that nearly all patients will eventually develop
anaemia.1,2 Patients treated with the most commonly used JAK
inhibitor will often require transfusions, and more than 30% will
discontinue treatment due to anaemia.3 Anaemia and transfusion
dependence are strongly correlated with poor prognosis and
decreased overall survival.4
Momelotinib has a differentiated mode of action with inhibitory
activity along key signalling pathways. This activity may lead to
beneficial treatment effects on anaemia and reduce the need for
transfusions while also treating symptoms. In January 2022, Sierra
Oncology announced positive topline results from the MOMENTUM phase
III trial. The study met all its primary and key secondary
endpoints, demonstrating that momelotinib achieved a statistically
significant and clinically meaningful benefit on symptoms, splenic
response, and anaemia.
Luke Miels, Chief Commercial Officer, GSK said: “Sierra
Oncology complements our commercial and medical expertise in
haematology. Momelotinib offers a differentiated treatment option
that could address the significant unmet medical needs of
myelofibrosis patients with anaemia, the major reason patients
discontinue treatment. With this proposed acquisition, we have the
opportunity to potentially bring meaningful new benefits to
patients and further strengthen our portfolio of specialty
medicines.”
Stephen Dilly, MBBS, PhD, President and Chief Executive
Officer, Sierra Oncology said: “Uniting with GSK creates the
best opportunity for Sierra Oncology to realise its mission of
delivering targeted therapies that treat rare forms of cancer while
also delivering compelling and certain value for our stockholders.
Now we have a partner with a global infrastructure and oncology
expertise that enables us to deliver momelotinib to patients as
quickly as possible and on a global scale.”
Momelotinib complements GSK’s Blenrep (belantamab mafodotin),
building on GSK’s commercial and medical expertise in haematology.
The proposed acquisition aligns with GSK’s strategy of building a
strong portfolio of new specialty medicines and vaccines. If the
transaction is completed and momelotinib is approved by regulatory
authorities, GSK expects momelotinib will contribute to GSK’s
growing specialty medicines business, with sales expected to begin
in 2023, with significant growth potential and a positive benefit
to the Group’s adjusted operating margin in the medium term.
Financial considerations
Under the terms of the agreement, the acquisition will be
effected through a one-step merger in which the shares of Sierra
Oncology outstanding will be cancelled and converted into the right
to receive $55 per share in cash. Subject to customary conditions,
including the approval of the merger by at least a majority of the
issued and outstanding shares of Sierra Oncology, and the
expiration or earlier termination of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, the
transaction is expected to close in the third quarter of 2022 or
before.
The per share price represents a premium of approximately 39 per
cent to Sierra Oncology’s closing stock price on 12 April 2022 and
a premium of approximately 63 per cent to Sierra’s volume-weighted
average price (VWAP) over the last 30 trading days. Sierra
Oncology’s Board of Directors has unanimously recommended that
Sierra’s stockholders vote in favour of the approval of the merger.
Additionally, stockholders of Sierra Oncology holding approximately
28 per cent of Sierra’s outstanding shares, have agreed to vote
their shares in favour of approval of the merger.
GSK will account for the transaction as a business combination
and expects it to be accretive to adjusted EPS in 2024, the
expected first full year of momelotinib’s sales. New GSK reaffirms
its full-year 2022 guidance, the medium-term outlook for 2021-2026
of more than 5% sales and 10% adjusted operating profit CAGR* at
CER**, and long-term sales ambition.
The value of the gross assets of Sierra Oncology to be acquired
(as of 31 December 2021) is $109 million (£83 million at the rate
of £1 = $1.312, being the 31 March 2022 spot rate). The net losses
of the business were $95 million for the 12 months ended 31
December 2021 (£70 million, at the rate of £1 = $1.38, being the
average rate for the period).
* CAGR: Compound Annual Growth Rate; **CER: Constant Exchange
Rate
Advisors
PJT Partners is acting as financial advisor and Cleary Gottlieb
Steen & Hamilton LLP is serving as legal counsel to GSK in
connection with the transaction. Lazard is acting as financial
advisor and Wilson Sonsini Goodrich & Rosati is serving as
legal counsel to Sierra Oncology.
About Sierra Oncology
Sierra Oncology is a late-stage biopharmaceutical company based
in San Mateo, California, on a mission to deliver targeted
therapies that treat rare forms of cancer. In addition to
momelotinib, the pipeline consists of two assets in phase I SRA515
and SRA737. SRA515 is a selective bromodomain-containing protein 4
(BRD4) bromodomain and extra-terminal domain (BET) inhibitor with a
novel bivalent binding mode that inhibits both protein
bromodomains, and SRA737 is a novel checkpoint kinase 1 (CHK1)
inhibitor.
About myelofibrosis
Myelofibrosis is a fatal disorder of the bone marrow where
fibrous scar tissue gradually replaces normal bone marrow, limiting
its ability to make blood cells (haematopoiesis). This may cause
anaemia (reduced red blood cells), leading to shortness of breath
or fatigue; increased risk of infection due to decreased white
blood cells; or increased risk of bleeding or bruising due to
reduced platelet counts. Organs such as the spleen or liver may
start to produce blood cells. This is known as extramedullary
haematopoiesis, which causes splenomegaly or hepatomegaly (enlarged
spleen or liver). Myelofibrosis affects approximately 20,000
patients in the US.
About momelotinib
Momelotinib has a differentiated mode of action with inhibitory
ability along three key signalling pathways: activin A receptor,
type I (ACVR1)/activin receptor-like kinase-2 (ALK2), Janus kinase
(JAK) 1, and JAK2. This activity may lead to beneficial treatment
effects on anaemia and reduce transfusion dependence while treating
myelofibrosis symptoms and splenic response.
About the MOMENTUM phase III trial
MOMENTUM is a global, randomised, double-blind phase III
clinical trial of momelotinib versus danazol in patients with
myelofibrosis. Patients were symptomatic and anaemic and had been
previously treated with an FDA-approved JAK inhibitor. The study
was designed to evaluate the safety and efficacy of momelotinib for
the treatment and reduction of the key hallmarks of the disease:
symptoms, blood transfusions (due to anaemia) and splenomegaly.
The primary endpoint of the study was a Total Symptom Score
(TSS) reduction of ≥50% over the 28 days immediately before the end
of Week 24 compared to baseline TSS, using the Myelofibrosis
Symptom Assessment Form (MFSAF). Secondary endpoints included
Transfusion Independence (TI) rate for ≥12 weeks immediately before
the end of Week 24 with maintained haemoglobin levels ≥ 8 g/dL and
Splenic Response Rate (SRR) based on splenic volume reduction of
≥35% at Week 24. The study enrolled 195 patients based on a planned
180 patients across 21 countries.
Danazol was selected as the treatment comparator, given its use
to ameliorate anaemia in patients with myelofibrosis, as
recommended by the National Comprehensive Cancer Network (NCCN) and
the European Society of Medical Oncology (ESMO) guidelines.
Patients were randomized 2:1 (momelotinib n = 130 and DAN n = 65)
to receive either momelotinib or danazol. After 24 weeks of
treatment, patients on danazol were allowed to cross over to
receive momelotinib. Early cross over to momelotinib was available
for confirmed symptomatic splenic progression.
In January 2022, Sierra Oncology reported top-line results from
the MOMENTUM phase III trial showing that the study met the primary
endpoint of TSS reduction of ≥50% with 25% in the momelotinib arm
versus 9% in the control arm (p=0.0095). Additionally, the trial
met its secondary endpoints of TI with 31% in the momelotinib arm
versus 20% in the control arm (one-sided p=0.0064; non-inferiority)
and SRR based on splenic volume reduction of ≥35% with 23% in the
momelotinib arm versus 3% in the control arm (p=0.0006). Grade 3 or
worse adverse events in the randomised treatment period were 54% in
the momelotinib arm and 65% in the control arm. Serious
treatment-emergent adverse events were 35% in the momelotinib arm
and 40% in the control arm.
These data will support Sierra Oncology’s planned regulatory
submissions with health authorities. The complete data from the
MOMENTUM phase III trial will be presented at a forthcoming medical
conference.
Additional information and where to find it
This communication is being made in respect of the proposed
acquisition of Sierra Oncology, Inc. (“Sierra”) by GlaxoSmithKline
plc (“GSK”). In connection with the proposed acquisition, Sierra
intends to file with the Securities and Exchange Commission (the
“SEC”) and mail to its stockholders a proxy statement (the “Proxy
Statement”) in connection with the solicitation of proxies to
approve the transaction. Sierra’s stockholders are urged
to read the Proxy Statement and any other relevant documents filed
with the SEC or delivered to Sierra’s stockholders in connection
with the transaction when such materials become available because
they will contain important information about the transaction and
the parties to the transaction. The Proxy Statement and all
other documents filed by or caused to be filed by Sierra with the
SEC will be available at no charge on the SEC’s website at
www.sec.gov. You may read and copy those documents or other
information filed by Sierra at the SEC public reference room at 100
F Street, N.E., Washington, D.C. 20549. Please call the SEC at
1-800-0330 for further information on the public reference room. A
free copy of the Proxy Statement and all other documents filed by
or caused to be filed by Sierra with the SEC will also be available
by visiting Sierra’s website (https://www.sierraoncology.com).
Participants in the Solicitation
Sierra, GSK, and certain of their respective directors and
executive officers may be deemed to be participants in the
solicitation of proxies from Sierra’s stockholders with respect to
the proposed acquisition. Information about Sierra’s directors and
executive officers is available in Sierra’s proxy statement dated
April 23, 2021 for its 2021 Annual Meeting of Stockholders.
Information about GSK’s directors and executive officers can be
found in GSK's Annual Report on Form 20-F for 2021. Other
information regarding the participants in the proxy solicitation
and a description of their direct and indirect interests, by
security holdings or otherwise, will be contained in the Proxy
Statement and all other relevant materials to be filed with the SEC
or delivered to Sierra’s stockholders regarding the proposed
combination when such materials become available. Sierra’s
stockholders are urged to read such materials when they become
available.
Cautionary statement regarding forward-looking
statements
GSK cautions investors that any forward-looking statements or
projections made by GSK, including those made in this announcement,
are subject to risks and uncertainties that may cause actual
results to differ materially from those projected. Such factors
include, but are not limited to, those described in GSK's Annual
Report on Form 20-F for 2021 and any impacts of the COVID-19
pandemic.
Definitions of Adjusted results, CER growth, CAGR and new GSK
are set out on pages 61 and 62 of GSK's fourth quarter 2021
earnings release and pages 56 and 59 of the GSK 2021 Annual Report.
The assumptions and basis for GSK’s Guidance and Outlook are set
out on page 69 of the GSK 2021 Annual Report.
This communication includes forward-looking statements related
to Sierra, momelotinib and the acquisition of Sierra by GSK, that
are subject to risks, uncertainties and other factors. All
statements other than statements of historical fact are statements
that could be deemed forward-looking statements, including all
statements regarding the intent, belief or current expectation of
Sierra and members of its senior management team and can typically
be identified by words such as “believe,” “expect,” “estimate,”
“predict,” “target,” “potential,” “likely,” “continue,” “ongoing,”
“could,” “should,” “intend,” “may,” “might,” “plan,” “seek,”
“anticipate,” “project” and similar expressions, as well as
variations or negatives of these words. Forward-looking statements
include, without limitation, statements regarding the business
combination, similar transactions, prospective performance, future
plans, events, expectations, performance, objectives and
opportunities and the outlook for Sierra’s business; the commercial
success of Sierra’s products; the anticipated timing of clinical
data and regulatory filings or approvals relating to products; the
possibility of favourable or unfavourable results from clinical
trials; the anticipated benefits of the acquisition; filings and
approvals relating to the transaction; the expected timing of the
completion of the transaction; the parties’ ability to complete the
transaction; and the accuracy of any assumptions underlying any of
the foregoing. Investors are cautioned that any such
forward-looking statements are not guarantees of future performance
and involve risks and uncertainties and are cautioned not to place
undue reliance on these forward-looking statements. Actual results
may differ materially from those currently anticipated due to a
number of risks and uncertainties. Risks and uncertainties that
could cause the actual results to differ from expectations
contemplated by forward-looking statements include: uncertainties
as to the timing of the completion of the merger; the possibility
that various closing conditions for the transaction may not be
satisfied or waived, including that the required approval of
Sierra’s stockholders may not be obtained or that required
regulatory approvals may not be obtained or are obtained subject to
conditions that are not anticipated; the occurrence of any event,
change or other circumstance that could give rise to the
termination of the merger agreement; the failure to realize
anticipated benefits of the proposed acquisition when expected or
at all; potential adverse reactions or changes to business
relationships resulting from the proposed acquisition, including
the effect of the announcement on the ability of Sierra to retain
and hire key personnel; risks that the proposed acquisition
disrupts the current plans and operations of Sierra; transaction
costs; risks associated with potential litigation related to the
transaction; and other risks and uncertainties described from time
to time in documents filed with the SEC by Sierra, including
current reports on Form 8-K, quarterly reports on Form 10-Q and
annual reports on Form 10-K, as well as the proxy statement to be
filed by Sierra, or in GSK’s Annual Report on Form 20-F for 2021
filed with the SEC by GSK. All forward-looking statements are based
on information currently available to GSK and Sierra, and neither
GSK nor Sierra assumes any obligation to update any forward-looking
statements.
About GSK
GSK is a science-led global healthcare company. For further
information please visit www.gsk.com/about-us.
Cautionary statement regarding forward-looking
statements
GSK cautions investors that any forward-looking statements or
projections made by GSK, including those made in this announcement,
are subject to risks and uncertainties that may cause actual
results to differ materially from those projected. Such factors
include, but are not limited to, those described in the Company's
Annual Report on Form 20-F for 2020, GSK’s Q3 Results and any
impacts of the COVID-19 pandemic.
Registered in England & Wales:
No. 3888792
Registered Office:
980 Great West Road Brentford, Middlesex TW8 9GS
1 Naymagon L et al. HemaSphere (2017) 1:1(e1) 2Journal of
Hematology & Oncology volume 15, Article number: 7 (2022) 3
Ruxolitinib discontinuation syndrome: incidence, risk factors, and
management in 251 patients with myelofibrosis | Blood Cancer
Journal (nature.com) 4 Prognostic relevance of anemia and
transfusion dependency in myelodysplastic syndromes and primary
myelofibrosis - PMC (nih.gov)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220411006012/en/
Sierra enquiries:
Investor
DeDe Sheel 415.732.9828 dsheel@sierraoncology.com
Media
Lauren Musto 615.351.7777 lmusto@sierraoncology.com
GSK enquiries: Media enquiries:
Tim Foley, +44 (0) 20 8047 5502, (London) Madeleine Breckon, +44
(0) 20 8047 5502, (London) Kristen Neese, +1 804 217 8147,
(Philadelphia) Kathleen Quinn, +1 202 603 5003, (Washington DC)
Lyndsay Meyer, +1 202 302 4595, (Washington DC)
Analyst/Investor enquiries:
Nick Stone, +44 (0) 7717 618834, (London) Sonya Ghobrial, +44
(0) 7392 784784, (Consumer) James Dodwell, +44 (0) 20 8047 2406,
(London) Mick Readey, +44 (0) 7990 339653, (London) Josh Williams,
+44 (0) 7385 415719, (London) Jeff McLaughlin, +1 215 751 7002,
(Philadelphia) Frannie DeFranco, +1 215 751 4855,
(Philadelphia)
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