Gilead and LEO Pharma Partner on Oral STAT6 Program
Gilead Sciences, Inc. (Nasdaq: GILD) and LEO Pharma today revealed a strategic partnership aimed at fast-tracking the development and commercialization of LEO Pharma’s small molecule oral STAT6 (Signal Transducer and Activator of Transcription 6) inhibitors for the treatment of inflammatory diseases.
STAT6 plays a crucial role in IL-4 and IL-13 cytokine signaling, which are vital drivers of Th2-mediated inflammatory conditions. These conditions include atopic dermatitis, asthma, chronic obstructive pulmonary disease (COPD), and various other inflammatory diseases. Targeting the STAT6 pathway has shown promise in preclinical studies as an effective strategy for treating a broad range of patients, offering an oral treatment alternative to current injectable biologics.
As part of the agreement, Gilead will acquire LEO Pharma’s preclinical portfolio of small molecule oral STAT6 inhibitors and targeted protein degraders. Gilead will assume leadership for the continued development of these oral therapies, while LEO Pharma will focus on developing potential topical formulations of STAT6 inhibitors for dermatological use.
Dr. Flavius Martin, Executive Vice President of Research at Gilead, emphasized the importance of advancing next-generation therapies for patients with chronic inflammatory conditions. He stated, “As we continue to expand our inflammation portfolio, we are committed to developing therapies that support long-term remission by targeting key pathogenic pathways, eliminating harmful cells, tolerizing the immune system, and restoring normal cellular function. Through this partnership, we aim to explore the potential of the STAT6 pathway and bring an oral treatment option to patients with chronic inflammatory conditions.”
Christophe Bourdon, CEO of LEO Pharma, highlighted the significance of STAT6 in treating a wide range of inflammatory diseases. He remarked, “STAT6 holds potential for treating a variety of inflammatory diseases, including those beyond dermatology. This partnership with Gilead will allow us to accelerate the development of the STAT6 program and maximize its potential in dermatology and beyond.” Bourdon also noted that the partnership underscores LEO Pharma’s scientific capabilities and its commitment to innovation in skin disease treatments.
Terms of the Partnership
Under the terms of the agreement, Gilead will acquire global rights to develop, manufacture, and commercialize the small molecule oral STAT6 inhibitors. LEO Pharma retains the option to co-commercialize the oral programs for dermatology outside the United States, while it will hold exclusive global rights for STAT6 topical formulations in dermatology.
LEO Pharma is poised to receive up to $1.7 billion in potential payments as part of the deal. This includes an upfront payment of $250 million, with additional payments tied to the achievement of various milestones. Additionally, LEO Pharma may receive tiered royalties on the sales of oral STAT6 products, ranging from the high single digits to mid-teens. Gilead, in turn, will receive tiered royalties on sales of topical STAT6 products, also ranging from the high single digits to mid-teens.
The financial impact on Gilead’s earnings is expected to reduce its GAAP and non-GAAP 2025 earnings per share (EPS) by approximately $0.15 to $0.17 due to the inclusion of acquired in-process research and development (IPR&D) expenses in its non-GAAP financial measures.
Bank of America Securities acted as financial advisor to LEO Pharma in this transaction, while Latham Watkins LLP provided legal advisory services.
About Gilead Sciences
Gilead Sciences is a global biopharmaceutical company that has been at the forefront of medical breakthroughs for over three decades. Its mission is to create a healthier world for all by advancing innovative therapies that prevent and treat life-threatening diseases such as HIV, viral hepatitis, cancer, and inflammation. Gilead’s operations span over 35 countries, with its headquarters in Foster City, California.
About LEO Pharma
LEO Pharma is a global company committed to advancing the standard of care for people with skin conditions. Co-owned by the LEO Foundation and Nordic Capital, LEO Pharma offers a broad range of treatments for dermatology and other skin-related disorders. The company serves over 100 million patients annually and has a workforce of 4,000 employees worldwide. Headquartered in Denmark, LEO Pharma generated net sales of $1.6 billion in 2023.
This partnership between Gilead and LEO Pharma represents a significant step forward in the development of innovative therapies for inflammatory diseases, offering new hope for patients in need of more effective, oral treatment options.
