The French drug developer provided notice to Lexicon about terminating its collaboration on the development, manufacture, and commercialization of Zynquista (sotagliflozin), an investigational treatment for type 1 and 2 diabetes, “given the primary endpoint results of blood sugar control reduction.”
Specifically, Sanofi announced that during the clinical program, Zynquista “did not achieve a statistically significant reduction” of the average sugar levels in subpopulations of patients with chronic kidney disease at stages 3B and 4.
Sanofi asked for the termination of the collaboration on all of the ongoing global type 1 and type 2 diabetes programs, stating that it will continue the Phase III clinical trials without immediate changes.
In an announcement, Lexicon stated that it considers Sanofi’s termination notice invalid and that Sanofi is in breach of contract.
Under the initial agreement, Lexicon received an upfront payment of $300 million and is eligible for development, regulatory and sales milestone payments of up to $1.4bn (€1.26bn).
Lexicon had also agreed to share in the funding of a portion of the development costs for three years following the agreement, up to an aggregate of $100m.
According to Lexicon, the collaboration and license agreement provides that even if a valid termination of the alliance had been delivered, Sanofi has continuing contractual obligations to transition rights and continue to fund ongoing clinical trials for a contractually specified period of time following the termination.
“While we are disappointed in the position taken by Sanofi, we are confident in the strength of the data we have seen thus far in the type 2 diabetes program,” Lexicon’s CEO, Lonnel Coats, said in a statement.
He added that Lexicon is "optimistic" about achieving "continued success" in the balance of the core Phase III program, which is expected to be completed in the following months.
Additionally, Coats said that “in the event of a valid termination of the Sanofi alliance, we will also look forward to regaining full rights to Zynquista in type 1 diabetes in the US, as well as rights in the remainder of the world, notably including the European Union (EU), in which Zynquista has already received approval.”
Zynquista is approved in the EU as an adjunct to insulin therapy to improve glycemic control in adults with type 1 diabetes.