Axsome Therapeutics has acquired exclusive global rights to AZD7325, a novel oral GABAA receptor α2,3 subtype-selective positive allosteric modulator (PAM), through its acquisition of Baergic Bio from Avenue Therapeutics. The compound, originally licensed from AstraZeneca and previously known as BAER-101, will be designated as AXS-17 under Axsome's development program and evaluated as a potential treatment for epilepsy.
Clinical Development and Safety Profile
AZD7325 has completed Phase 1 trials and demonstrated a favorable safety and tolerability profile in clinical studies involving over 700 patients. The compound has shown anti-convulsant effects in multiple preclinical seizure models, providing the scientific rationale for its development in epilepsy treatment.
"This transaction adds AZD7325, an earlier stage molecule with a differentiated mechanism of action, to our leading late-stage CNS portfolio," said Herriot Tabuteau, MD, Chief Executive Officer of Axsome. "We are excited to further deepen our research pipeline in a complementary way, and to extend our clinical efforts into epilepsy, an area where there is an urgent need for innovative new treatment options for patients."
Axsome plans to begin Phase 2 trial-enabling activities in 2026, marking the company's expansion into epilepsy therapeutics.
Addressing Unmet Medical Need in Epilepsy
Epilepsy represents a significant medical challenge, affecting approximately 3.4 million people in the United States, with about 150,000 new cases diagnosed annually. The chronic neurological disorder is characterized by recurrent, unprovoked seizures caused by sudden and uncontrolled surges of electrical activity in the brain.
Despite currently available treatment options, more than one-third of patients do not respond to existing therapies, highlighting the substantial unmet medical need that AZD7325 could potentially address. Patients with epilepsy often face stigma, barriers to education and employment, higher rates of comorbid psychiatric conditions, and increased risk of premature mortality.
Transaction Structure and Financial Terms
The acquisition was effectuated through Axsome's purchase of 100% equity interest in Baergic Bio, a subsidiary of Avenue Therapeutics, along with a concurrent amendment to the license agreement between Baergic Bio and AstraZeneca. Under the terms of the agreement, Baergic Bio shareholders will receive a $0.3 million upfront payment and are eligible for development and regulatory milestone payments of $2.5 million for the first indication and $1.5 million for each subsequent indication.
The deal structure includes up to $79 million in potential sales-based milestones and a tiered mid-to-high single-digit royalty on potential global net sales of AZD7325. Avenue Therapeutics expects to receive approximately 74% of all future payments and royalties under the agreement. AstraZeneca will receive a cash upfront payment in the single-digit millions and is eligible for similar milestone payments and royalties.
Strategic Portfolio Expansion
The acquisition deepens Axsome's neuroscience portfolio with a synergistic early-stage program that complements the company's existing FDA-approved treatments for major depressive disorder, excessive daytime sleepiness associated with narcolepsy and obstructive sleep apnea, and migraine.
"This acquisition by Axsome will enable the efficient progression of this potentially best-in-class targeted therapy for epilepsy," said Alexandra MacLean, M.D., Chief Executive Officer of Avenue Therapeutics. "By leveraging Axsome's expertise, we hope that the development of the therapy can be accelerated for the benefit of patients suffering from epilepsy."
The transaction represents Axsome's continued commitment to addressing serious neurological conditions through innovative mechanisms of action, potentially expanding treatment options for patients with treatment-resistant epilepsy.
