Ortho-McNeil terminates collaboration agreement with Arena on APD597 trial program

Arena Pharmaceuticals, Inc. (Nasdaq: ARNA) announced today that, following the completion of a Phase 1 clinical trial program for APD597 (JNJ-38431055) under its collaboration with Arena, Ortho-McNeil-Janssen Pharmaceuticals, Inc., has decided not to advance APD597 and has notified Arena that it is terminating the collaboration, effective December 28, 2010. APD597 is a GPR119 agonist intended for the treatment of type 2 diabetes, which, along with other compounds and intellectual property, will revert to Arena upon termination of the collaboration. Arena owns a patent portfolio covering a broad array of internally discovered, oral GPR119 agonists, including next generation compounds that were not part of the collaboration.

The Phase 1 program evaluated the safety, tolerability, pharmacokinetics and pharmacodynamics of APD597, and included single and multi-ascending studies in healthy volunteers and in subjects with type 2 diabetes. APD597 was well tolerated and showed dose-proportional pharmacokinetics with a half-life of six to seven hours in solution and approximately 13 hours in suspension in healthy volunteers. The Phase 1 program also provided evidence for incretin stimulation (GLP-1, GIP and PYY) and reductions in post-meal glucose increases with APD597 treatment in both overweight and obese non-diabetic volunteers and in subjects with type 2 diabetes. In general, reductions in post-meal glucose increases were greater with APD597 in combination with sitagliptin, a DPP-4 inhibitor, compared to sitagliptin alone.

"Results of the Phase 1 program suggest that APD597 may have utility both alone and in combination with a DPP-4 inhibitor for the treatment of type 2 diabetes," said Jack Lief, Arena's President and Chief Executive Officer. "With our existing GPR119 patent portfolio, internally discovered next generation compounds and return of rights under the collaboration, including to APD597, we look forward to pursuing additional opportunities in this area."

Upon termination of the collaboration, all rights under licenses granted by Arena to Ortho-McNeil-Janssen under the agreement will terminate and revert to Arena, including rights relating to APD597. Ortho-McNeil-Janssen will also be required to deliver and assign to Arena rights and information relating to regulatory filings, including the Investigational New Drug Application (IND) relating to APD597, as well as certain other technology that may be useful to the development of GPR119 agonists that were subject to the collaboration. In addition, Ortho-McNeil-Janssen will cease reimbursing Arena for the cost of prosecuting Arena's GPR119 patent portfolio.

Arena owns a broad array of internally discovered, oral GPR119 agonists, including next generation compounds that Arena discovered after the research portion of its collaboration with Ortho-McNeil-Janssen ended in October 2007, and a portfolio of patent applications and, in some cases, granted patents directed to a range of materials and methods that are related to the discovery and development of GPR119 receptor agonists. Arena believes that approximately half of the top 20 pharmaceutical companies in the world have either acknowledged having an internal or collaborative GPR119 program or published medicinal chemistry patents directed to GPR119 agonists. The technologies covered by Arena's patents and patent applications include materials and methods that may be used to identify and determine the activity of molecules that modulate the GPR119 receptor, methods that measure the incretin response to GPR119 agonists and pharmaceutical compositions containing GPR119 agonists along with DPP-4 inhibitors.