Nektar (NKTR) Announces Formation Of CNS-Focused Subsidiary
Zacks Investment Research | May 23, 2019 09:56PM ET
Nektar Therapeutics (NASDAQ:NKTR) announced that it has formed a new wholly-owned subsidiary, Inheris Biopharma, Inc., which will its pipeline of pre-clinical central nervous system (“CNS”) candidates. The new subsidiary will mainly be responsible for the potential launch and commercialization of Nektar’s opioid-based pain candidate, NKTR-181, which is under review in the United States. A decision from the FDA for NKTR-181 is expected by the end of August 2019.
Inheris Biopharma will be led by Jay Galeota, who has been appointed as the president and chief executive officer of the entity. Galeota has more than three decades of experience in the pharma industry. He held several leadership positions at Merck (NYSE:MRK) in the past. Joe Stauffer and George Shiebler have been appointed as chief medical officer, and senior vice president and general counsel, respectively. Both of them have rich experience in their field of work.
The separation will likely help Nektar to collaborate with one or more potential capital partners to commercialize NKTR-181 without impacting the company’s other pipeline candidates.
Shares of the company have increased 0.6% so far this year compared with the industry ’s rise of 5.6%.
A potential approval to NKTR-181, which is under review as analgesic for treating chronic low back pain in patients new to any opioid therapy, will be a positive for Nektar. The drug may generate significant sales as low back pain is a major factor leading to disability in adults in the United States. Moreover, NKTR-181, a mu-opioid, has exhibited reduced incidence of euphoria associated with opioids, which can lead to abuse and addiction. This may boost demand for the drug in a country, which is fighting opioid-abuse.
However, investors should be aware of the fact that NKTR-181 may face regulatory and commercialization hurdles due to its opioid-based formulation.
We expect Nektar to focus on its oncology and auto-immune disorder pipeline following the separation of launch activities for NKTR-181 and pre-clinical CNS pipeline into a new subsidiary.
Nektar is developing several immuno-oncology candidates with bempegaldesleukin being its primary candidate. The company is also developing several other candidates across important therapeutic areas including Onzeald in breast cancer and NKTR-255 in virology indications.
The company has collaborations with major pharma companies for developing some of its pipeline candidate. These include Bristol-Myers for bempegaldesleukin, Eli Lilly (NYSE:LLY) for auto-immune disorder candidate, NKTR-358, and Gilead Sciences (NASDAQ:GILD) for pre-clinical immuno-oncology candidate, NKTR-255.
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