Incyte’s pipeline updates on Monday bring into question the value of its $750 million Escient acquisition in April 2024—and further erode confidence that the biotech can effectively mitigate the impacts of Jakafi’s loss of exclusivity in the coming years, according to analysts.
Incyte on Monday announced that it will suspend enrollment into the ongoing Phase II study of its investigational MRGPRX2 inhibitor INCB000262 in chronic spontaneous urticaria.
The pause follows certain “in vivo preclinical toxicology findings,” according to the biotech’s press announcement, though it did not specify what these toxicology signals were. Incyte has already shared these findings with the FDA and is currently working with the agency to determine the next steps for INCB000262.
Despite Monday’s pause, enrollment into the proof-of-concept studies for INCB000262 has already completed, and data from the candidate’s clinical development program “will help inform its future development,” according to Incyte. This information will also “guide the potential development of back-up molecules.”
Aside from the enrollment freeze, Incyte on Monday also announced that Phase II data for its MRGPRX4 antagonist INCB000547 does not support further development. The candidate was being trialed in cholestatic pruritus.
Incyte was down around 9% in after-hours trading, dropping to $69.98 from $76.97 at the previous close.
Incyte obtained INCB000262 and INCB000547 with its $750 million acquisition of Escient Pharmaceuticals in April 2024. At the time, Incyte CEO Hervé Hoppenot said that the assets “address large populations with a clear medical need and a multibillion-dollar total market opportunity.” Prior to Monday’s stumbles, Incyte was planning to run pivotal studies for INCB000262 and INCB000547 between 2025 and 2027, with potential approvals toward the end of the decade.
In an investor note, William Blair analyst Matt Phipps called Monday’s pipeline development “clearly disappointing, given ‘262 is the molecule at the center of the $750 million acquisition of Escient.” The firm had previously projected a 2029 potential launch for the asset, which could have contributed “significant sales” for the biotech in the next decade, “given the molecule is being evaluated in sizable market opportunities with blockbuster potential.”
BMO Capital Markets’ Evan Seigerman called Incyte’s Monday update “another pipeline misstep.” Of note, Seigerman raised concerns that the toxicology findings for INCB000262 could lead to “significant new uncertainty in these ongoing studies in chronic inducible urticaria and atopic dermatitis.”
Meanwhile, the discontinuation of INCB000547 in cholestatic pruritus “removes yet another potential upside catalyst for Incyte” and “further raises questions on the merits of the Escient deal,” Seigerman pointed out.
“Today’s news concretizes our lack of confidence that Incyte’s pipeline can overcome Jakafi concerns,” Seigerman added, referring to Incyte’s JAK inhibitor ruxolitinib indicated for polycythemia vera, myelofibrosis and graft-versus-host disease, patent protections for which are expected to expire in 2028.
