Both companies will be equally responsible for developmental costs and revenue in major markets. Image Credit: ricochet64 / Shutterstock.

Sanofi has signed an agreement to license Teva Pharmaceuticals’ inflammatory bowel disease therapy, TEV’574.

TEV’574 is an anti-tumour necrosis factor-like ligand 1A (TL1A) therapy. It is currently being investigated as a treatment for two types of inflammatory bowel disease (IBD), ulcerative colitis and Crohn’s disease. The initial results from the clinical studies are expected in 2024.

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As per the agreement, Teva will receive an upfront payment of €469m ($500m) and will be in line for milestone-based payments of up to €940m ($1bn). Sanofi would lead the Phase III development programme.

Both companies will be equally responsible for developmental costs and revenue in major markets. Teva will have primary commercial rights in Europe, Israel, and some of the specified countries, whilst Sanofi holds these rights in North America, Japan, other parts of Asia and the rest of the world.

The agreement also increased the competition in the IBD drug pipeline, especially after Merck & Co. acquired Prometheus Biosciences in April. One of the biggest assets acquired as part of the agreement was anti-TL1A therapy PRA023, which reported positive results in both the Phase II trials for ulcerative colitis and Crohn’s disease.

GlobalData forecasts the therapies for treating ulcerative colitis to generate $6.5bn in sales in 2031 across North America.

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Both Sanofi and Teva have announced similar deals in recent months. Yesterday, Sanofi partnered with Janssen Pharmaceuticals to develop and commercialise a nine-valent vaccine candidate for E coli. Sanofi paid $175m in upfront payment and will have a profit-share arrangement with Janssen for vaccine sales in the US, UK, Germany, Italy, Spain, and France.

In July, Teva partnered with Alvotec to add two additional biosimilars to the development pipeline. Adding to the previous agreement to develop and commercialise five biosimilars, including ATV04, a biosimilar of Janssen’s Stelara (ustekinumab) for the treatment of IBD.