Shire acquires Meritage, phase 3-ready compound for $70 million

Shire announced the company obtained Meritage Pharma as well as the rights to the pharmaceutical company’s phase 3-ready compound, oral budesonide suspension, at a cost of $70 million, according to a press release.

Oral budesonide suspension (OBS) is an exclusive oral formulation of budesonide that is being studied as a treatment option for adolescents and adults with a rare chronic inflammatory GI disease, eosinophilic esophagitis (EoE), the release said. The drug has been designated to orphan drug status by the FDA.

Budesonide is the active ingredient in several FDA-approved drugs that treat diseases such as asthma, allergic rhinitis, ulcerative colitis and Crohn’s disease.

“Meritage has worked closely with gastroenterologists, patients and their caregivers to develop [OBS], which was the first medication to significantly reduce eosinophilic inflammation and related symptom endpoints in patients with eosinophilic esophagitis in a phase 2 clinical trial,” Elaine Philips, PhD, president and CEO of Meritage, said in the release. “The acquisition of Meritage by Shire, a global biotechnology company with GI and rare disease expertise, may benefit physicians and patients by helping develop OBS to potentially become the first approved treatment in the US indicated for this often disabling disease.”

According to the release, EoE is increasing within the US population and affects approximately 181,000 patients. The disease is associated with esophageal dysfunction, including dysphagia and food impaction. The viscous formula of OBS will be used to coat the esophagus where the drug can act locally.

Shire gains the rights to Meritage and OBS after obtaining ViroPharma last year. The compound adds to Shire’s late-stage pipeline.

Aside from the upfront payment, Shire will pay additional expenses depending on developmental successes and “regulatory milestones,” according to the release.