In the span of eight months, Big Pharma companies took over four of the hottest radiopharmaceutical players in the industry.
Novartis paid $1 billion for Mariana Oncology. Eli Lilly jumped in with a $1.4 billion buyout of Point Biopharma. AstraZeneca spent $2.4 billion for Fusion Pharmaceuticals. And Bristol Myers Squibb ponied up $4.1 billion for RayzeBio.
Why is Big Pharma suddenly placing bets—big and small—on a medicine type that has been in the works for nearly a century, starting with radioactive iodine?
It has much to do with the ability of today’s technologically souped-up products—which use radioisotopes with improved stability—to deliver radiation directly to tumors and with minimal side effects.
“The technology has made such a difference,” Michael Abrams, managing partner at Numerof & Associates, said in an interview. “It’s being able to have highly targeted cancer treatments with precision and minimal damage to healthy tissues that’s really driving this acquisition orgy.”
The splurge of dealmaking activity surrounding radiopharmaceuticals also includes licensing agreements, such as Novartis’ partnership with Japan’s PeptiDream, which could be worth $2.7 billion, and Lilly’s pact with Aktis Oncology, which includes $1.1 billion in potential milestones.
In addition, the scramble to gain assets can be chalked up to a rapidly expanding market. The radiopharma field is expected to grow from $9.1 billion in 2023 to $26.5 billion in 2031, a 14% compound annual growth rate, according to Insight Partners.
Fortune Business Insights is even more bullish with its estimate of the radiopharmaceuticals market, projecting average annual growth of 19%, from $10.2 billion in 2024 to $42 billion in 2032.
Fortune and Insight base some of their growth projections on the surge in clinical trials underway for investigational radiopharma drugs, an increase that is likely to fuel more M&A activity, according to Matt Furlow, Ph.D., an associate principal at management consulting and technology firm ZS.
“We’ll start to see acquisition or licensing activity driven by clinical data inflection points,” Furlow said in an interview. “If we see a big data release, even early phase clinical trials from one of these companies that is still independent, that’ll certainly drive interest in larger companies that have yet to enter this space.”
Pioneering efforts
More than two decades ago, companies such as GSK (Bexxar) and IDEC (Zevalin) brought radioligand drugs to the market that were shown to be safe and effective. But the products had limited commercial success because of their prohibitive cost to manufacture and distribute.
Then, in 2013, Bayer made a big splash in the arena by acquiring Norwegian biotech Algeta and its newly FDA-approved drug Xofigo for $2.9 billion. Sales of Xofigo, which treats prostate cancer that has spread to the bone, peaked at $408 million (PDF) in 2017 but have been in decline ever since a phase 3 trial—testing Xofigo in a combination with Johnson & Johnson’s Zytiga and steroids—produced more deaths and fractures than without the addition of Xofigo.
Novartis has had the most success monetizing its radiopharma efforts. First came Lutathera, a treatment for neuroendocrine cancers the Swiss company picked up in a $3.9 billion acquisition of Advanced Accelerator Applications in 2017. It racked up sales of $534 million the first three quarters of 2024.
In 2018, the same year that the FDA signed off on Lutathera, Novartis gained another promising radiopharma treatment in its $2.1 billion takeover of Endocyte. Four years later, Novartis secured FDA approval for prostate cancer treatment Pluvicto, which has quickly become the most successful radioligand therapy ever, generating sales of $1.04 billion in the first three quarters of 2024.
According to John Babich, Ph.D., chief scientific officer of radioligand developer Ratio Therapeutics, Novartis’ success has triggered a surge in interest in the arena.
“With Pluvicto and Novartis, now you’re in a big cancer showing big improvements in survival where nothing else works,” Babich said in an interview with Fierce Pharma last year, a few months before Ratio signed a licensing deal with Novartis.
It wasn’t just the sales of Lutathera and Pluvicto that convinced other companies they could have success with radiopharmaceuticals. It also had to do with how Novartis met the challenges posed by the production and distribution of radioligand products given the scarcity and expense of the starting materials and the inherent difficulty in getting a medicine with a very limited shelf-life to patients.
In 2022, when Pluvicto was approved, Novartis shipped the medicine from its lone manufacturing site in Italy. Since then, Novartis has added facilities in Spain and in the U.S. in New Jersey and Indianapolis, along with another to come in California. The company has a five-day window to ship the drug to patients, so a diversified geographic footprint makes it easier to meet that deadline.
“Companies now have a little more confidence that there has been infrastructure that’s built—both in the institutions but also in the ecosystem—that can be leveraged for distribution of these products,” Sankalp Sethi, a principal at ZS, told Fierce Pharma.
Those improvements have also helped alleviate the doubts of prescribers that mechanisms are in place to produce and deliver the medicine reliably and safely.
There’s never been much doubt about Pluvicto’s clinical profile, as it was shown to extend patient lives by an average of four months and reduce the risk of death by 38% when added to standard of care. The numbers are particularly compelling because Pluvicto is largely for patients who have run out of treatment options.
One more factor drawing companies to radiopharmaceuticals is that they are less likely to be challenged by generic or biosimilar competition because of how difficult the products are to manufacture and distribute.
What’s next?
While Novartis has had success with its second-generation radioligand products, drugmakers are trying to position themselves to cash in on the next wave of new treatments in the arena.
ZS’s Furlow believes growth will be fueled by the development and commercialization of radiopharmaceuticals that employ alpha-emitting radionuclides. These drugs "pack more of a punch, but act over a shorter distance" than current options, he said, making them safer than medicines made with the beta-emitting radionuclide leutetium-117 (Lu-117).
Another advantage of alpha-emitting radionuclides is that their potency half-life extends to roughly 10 days as opposed to six for the beta-emitting types, allowing for a larger window for delivery and administration.
In making its acquisition of RayzeBio—in which it outbid two other companies to pull off the largest M&A deal ever in radiopharma—Bristol Myers Squibb gained a platform based on the alpha-emitting isotope actinium-225 (Ac-225).
One of the big draws for BMS to RayzeBio was the biotech's production facility in Indianapolis. Another was an investigative neuroendocrine cancer treatment entering a phase 3 trial. But enrollment was temporarily halted in the study in June, demonstrating a problem often encountered with the manufacturing of radioligand products—a shortage of starting material.
For its part, Novartis is working to address this issue by adding a facility at its Indianapolis campus that will produce its own radioactive isotopes.
A new manufacturer attempting to relieve the shortfall in Ac-225 is Belgium-based PanTera, which has attracted partnerships with Bayer and another unnamed company in just its third year in business. Its partner in the U.S. is Bill Gates-founded TerraPower Isotopes, which extracts Ac-225 from legacy nuclear material.
“Lutetium-177 is the big boom right now,” PanTera CEO Sven Van Den Berghe told Fierce Pharma. “The next revolution is coming right after that, which is actinium-225, and it requires a completely different production route.”
Novartis’ $1 billion acquisition of Mariana and its licensing arrangement with PeptiDream—both coming in the same week—were motivated by the company’s focus on developing medicines with Ac-225.
Novartis also is exploring the potential of combining radioligands with other therapies in the same modality or with traditional medicines. This focus is evident in Novartis’ $150 million licensing deal—with an additional $1 billion in potential milestones on the line—for Arvinas’ late-stage protein degrader ARV-766. The company hopes the drug could be combined with Pluvicto to move into earlier treatment lines for prostate cancer.
Novartis is hardly moving away from developing potential products with Lu-177. Depending on the cancer target, Lu-177 or Ac-225 can be the optimal choice, as well as the agent in which the radiation is delivered, Shiva Malek, Ph.D., the global oncology chief at Novartis’ Institutes for BioMedical Research, said during a meet the management event in November.
“We think long and hard around both what format we’re using, be it small molecule, a peptide or a biologic as well as the radioisotope used,” Malek said. “We try to match that with the target as well as the tumor type.”