Regeneus signs agreement with Kyocera for licensing of Progenza knee osteoarthritis drug to Japanese market

Regeneus Kyocera Progenza knee osteoarthritis OA licence ASX RGS stem cell
Regeneus is expected to receive $27 million from Kyocera under the deal.

Clinical-stage regenerative medicine company Regeneus (ASX: RGS) has signed a licence and collaboration agreement with Kyocera Corporation to develop and commercialise its lead stem cell platform technology Progenza for the treatment of knee osteoarthritis in the Japanese market.

Under the terms of the agreement, Kyocera will fund the manufacturing, development, and commercialisation costs for the mesenchymal stem cell and secretome-based drug in Japan.

The company will sponsor a Progenza for Knee Osteoarthritis (Progenza OA) clinical study and all regulatory filings for the drug’s approval, as well as reimbursement with Japan’s National Health Insurance.

In return, Regeneus will receive $27 million from Kyocera, comprising $13 million upfront and $14 million in regulatory and development milestone payments.

The funds will provide a “cash runway” for Regeneus through to commercial launch of the product.

Additionally, Regeneus will receive “single to high double-digit royalties” on all future Progenza product sales in Japan based on future reimbursement prices.

Right of refusal

The collaboration agreement includes technology transfer and joint research on Progenza for the Japanese market, with Kyocera maintaining a first right of refusal for other indications inside and outside of the country.

In response, Regeneus will retain the right to negotiate licences with parties within and outside of Japan for indications other than knee osteoarthritis.

Phase 1 study

Regeneus has already completed a Phase 1 study on Progenza OA which demonstrated that a single injection into the knee was safe, tolerable, and showed significant, rapid and sustained reductions in knee pain for patients with osteoarthritis.

The same patients showed positive signs of disease modification with no deterioration in the joint following injection.

Product endorsement

Regeneus chief executive officer Leo Lee said the agreement with Kyocera is an endorsement of the Progenza platform technology.

“It provides a clear commercialisation pathway for [our lead drug] in a significant market given osteoarthritis potentially affects more than 25.6 million people in Japan alone,” he said.

“We look forward to working with Kyocera to take Progenza through the commercialisation process,” Mr Lee added.

The licence and collaboration agreement follows a previous deal signed in March between the two companies, which allowed Kyocera exclusive negotiation rights to Progenza for treatment of knee osteoarthritis until the end of July.

Unmet patient need

Progenza has been developed to address an unmet patient need for knee osteoarthritis ahead of invasive surgery, as it treats pain and modifies the disease.

Osteoarthritis relates to the ‘wear and tear’ of tissue around joints such as the knees, hands and hips and is characterised by pain and inflammation.

The global market for osteoarthritis is expected to grow to $4.9 billion by 2026, with the Japanese market currently worth around $489 million.

Japan’s potential osteoarthritis patient population is estimated at 25.6 million with 1.25 million people currently receiving some form of treatment.

Mr Lee said Japan has a favourable regulatory environment for regenerative medicine and there is potential to fast track approval for Progenza as products can be approved for sale under specific conditions once safety and efficacy are confirmed.

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