Novartis Withdraws EU Marketing Application for Eye-Care Drug XiidraBy
Novartis has voluntarily withdrawn its marketing authorization application (MAA) in the European Union for Xiidra (lifitegrast ophthalmic solution), a prescription drug for treating dry eye. Novartis had acquired the drug from Takeda last year (July 2019) in a $5.3-billion deal, including $3.4 billion upfront and up to $1.9 billion in potential milestone payments.
In a June 18, 2020 letter to the European Medicines Agency (EMA), Novartis said it decided to discontinue its application since “the major objections raised cannot be resolved within the available time frame.” The withdrawal was for Xiidra (lifitegrast) 50 mg/ml eye drops solution in single-dose container. Novartis said in its letter it reserves the right to make further submissions at a future date for the product or in other therapeutic indications. Novartis says there are no ongoing clinical trials with lifitegrast. The drug is approved in the US.
As a result of Novartis’ withdrawal of the MAA for Xiidra, Takeda says it expects that the probability of receiving certain sales-based milestones may be reduced although the total potential milestone receipts of up to $1.9 billion remain unchanged. As a result of the re-measurement, Takeda anticipates that it will recognize a loss of approximately $200 million in reported operating profits resulting in a loss of approximately $150 million in reported net profit for the three-month period ending June 30, 2020. Takeda says that the amounts will be finalized with the company’s results for three-month period ending June 30, 2020, and the actual loss may be higher or lower. As of March 31, 2020, Takeda had recognized approximately $850 million based on the estimated fair value of the contingent consideration related to potential milestone receipts.
Takeda gained Xiidra as part of its $62-billion acquisition of Shire in 2019. As part of a divestment program of non-core assets following the acquisition, Takeda decided to sell the drug to Novartis. Takeda says it remains committed to $10 billion of divestitures of its non-core assets, and that the announcement of the withdrawal of its MAA in the EU for Xiidra does not impact this commitment.