Sumitomo Dainippon, Roivant Sciences Complete $3-Bn Strategic AllianceBy
Sumitomo Dainippon Pharma and Roivant Sciences, a technology-enabled healthcare company, have completed a deal to form their previously announced strategic alliance and have formed a new company, Sumitovant Biopharma, in a $3-billion deal. Sumitomo Dainippon Pharma also has taken an 11% equity stake in Roivant Sciences.
The companies had announced the strategic alliance in October 2019. Roivant Sciences consists of multiple wholly owned or majority-owned biopharmaceutical subsidiaries (so-called “Vants”), each focused on a different disease area. The company employs a “hub and spoke” model for research and development, whereby each biopharmaceutical subsidiary functions as an independent entity (“spoke”) using shared resources from the parent (“hub”). Other Vants consist of technology-based platforms that support the operations of the biopharmaceutical Vants.
With the closing of the deal, Sumitovant will operate as a wholly owned subsidiary of Sumitomo Dainippon Pharma and will be the parent company of the five biopharma companies for which Roivant transferred its ownership interest: Myovant Sciences (women’s health and prostate cancer), Urovant Sciences (urinary diseases), Enzyvant Therapeutics (pediatric rare diseases), Altavant Sciences (respiratory rare diseases) and Spirovant Sciences (genetic lung disease).
In addition, Sumitovant will provide strategic guidance and direct the operations of the proprietary technology platforms now owned by Sumitomo Dainippon Pharma that were developed by Roivant: DrugOme and Digital Innovation. DrugOme is a technology platform that facilitates asset selection and informs clinical development and commercial strategy through computational analytics and techniques. Digital Innovation is a platform for applying technology to business problems to optimize business value. The involved technologists are embedded in each Vant and improve workflow and decision making by developing technologies and enabling automation. Sumitovant, Sumitomo Dainippon Pharma, and Roivant will each have access to these platforms. Sumitomo Dainippon Pharma has also acquired an 11% stake in Roivant and options to acquire Roivant’s ownership interests in six additional biopharma companies.
For its consideration Roivant has received $3 billion from Sumitomo Dainippon Pharma, which includes $2.0 billion for the acquisition of all the stock of Roivant’s 100%-owned new company, Sumitovant Biopharma, and $1.0 billion for the acquisition of 11% of Roivant’s shares.
Myrtle Potter, former Vant Operating Chair at Roivant Sciences, and formerly President and Chief Operating Officer, Genentech, has been appointed Chief Executive Officer of Sumitovant. As Vant Operating Chair, Potter oversaw the development of 35 investigational drugs in 11 therapeutic areas and over 50 clinical trials, including four successful Phase III trials for the lead compounds at Myovant and Urovant. Prior to Genentech, she was President of Bristol-Myers Squibb’s US cardiovascular and metabolic business. While at Merck & Co., she started the company Astra–Merck, Inc. which, through merger, became AstraZeneca.