[Edaily Reporter KIM JI-WAN ] Mezzion Pharma Co., Ltd.(140410)has established an additional U.S. subsidiary dedicated exclusively to the development of treatments for autosomal dominant polycystic kidney disease (ADPKD).

According to the company on the 23rd, Mezzion Pharma Co., Ltd. has established a new U.S. subsidiary (Mezzion Biotech, Inc.) dedicated to the development and commercialization of treatments for autosomal dominant polycystic kidney disease (ADPKD). This new entity was created separately from the existing U.S. subsidiary (Mezzion Pharmaceuticals, Inc.), which is responsible for developing treatments for the Fontan procedure, to exclusively handle the clinical trials and commercialization of future projects. Like its predecessor, this new subsidiary is also a wholly-owned subsidiary.

Mezzion Pharma Co., Ltd. is currently preparing to enter Phase 2b clinical trials for ADPKD in Korea and the U.S. following preliminary consultations with the U.S. Food and Drug Administration (FDA). Previously, in May, the company received written feedback from the FDA stating that the preclinical, clinical, and safety data for the existing drug Udenafil could serve as the basis for ADPKD clinical development. ADPKD is a rare genetic disorder in which cysts form and grow in both kidneys, leading to a gradual decline in kidney function. As the disease progresses, it can lead to end-stage renal disease, requiring dialysis or a kidney transplant.

“Separate from Fontan”… A Distinct “Price Tag” for ADPKD

The key point is that the company has laid the groundwork

for assigning

an independent “price tag” to its ADPKD business.

Mezzion Pharma Co., Ltd. explained, “We already had a U.S. subsidiary for Fontan,” adding, “We established a separate subsidiary for the ADPKD business and clinical trials.” The official continued, “We took into account the fact that, in the U.S., companies with specific pipelines often pursue M&A and IPOs in addition to technology transfers.”

The newly established subsidiary will oversee global clinical trials for ADPKD and regulatory consultations with the FDA. If it also pursues separate investment, M&A, or an IPO, the subsidiary itself could serve as a channel through which the value of ADPKD is recognized. This effectively opens up options beyond simply selling therapeutic rights through technology transfer—including securing investment from companies that own drugs or even selling the company itself.

The landscape also changes from a Daesang’s perspective.

Commenting on the establishment of this subsidiary, an investment banking industry insider analyzed, “Investors can commit funds based on the potential for success and marketability of ADPKD, rather than Mezion Pharma Co., Ltd. as a whole,” adding, “For Mezion Pharma Co., Ltd., this creates an opportunity to secure the necessary funding for ADPKD separately while continuing the development of the Fontan treatment.”

The company stated, “We will comprehensively review various options, including strategic partnerships for core intellectual property (IP) and local U.S. fundraising models,” adding, “We will implement a two-track growth model that maximizes the value of our subsidiary’s pipeline while maintaining the financial stability of the parent company.”

The Model Case: Regularus ($2.3 trillion, Telavant $10 trillion

) Mezzion Pharma Co., Ltd.’s establishment of this new subsidiary was inspired by Novartis’ acquisition of U.S.-based Regularus Therapeutics.

Last April, Novartis announced it would acquire Regulars on the condition of paying an upfront payment of $800 million (1.1077 trillion won) and an additional $900 million (1.2462 trillion won) upon achieving regulatory milestones. The maximum transaction value is $1.7 billion (2.3539 trillion won). With the acquisition completed in June of the same year, Regulars became an indirect wholly-owned subsidiary of Novartis.

The cornerstone of the deal was “Parabursen,” a drug candidate for ADPKD. This drug was developed to target the microRNA “miR-17” and inhibit the growth of cysts in the kidneys and the progression of the disease. At the time of the acquisition announcement, the drug had completed a Phase 1b clinical trial involving repeated dose escalation. This represented a massive investment in a new drug that had not yet received marketing approval. In other words, this was a transaction in which an entire company was acquired solely to secure a new ADPKD drug.

Transactions involving the acquisition of companies dedicated to specific drug pipelines are even more evident in Roche’s acquisition of Telavant.

In 2022, Roivant and Pfizer established Telavant to develop and commercialize “RVT-3101,” a candidate drug for inflammatory bowel disease, in the U.S. and Japan. Their respective equity stakes were 75% and 25%.

In October of the following year, Roche announced an agreement to acquire Telavant for an upfront payment of $7.1 billion (9.832 trillion won) and short-term milestones totaling $150 million (207.7 billion won). At the time, RVT-3101 had already secured Phase 2b clinical trial results. This move allowed Roche to secure the rights to a new drug housed in a separate company through an acquisition.

Targeting a Gap in Tolvaptan

, Mezion Pharma Co., Ltd.

Accelerates Clinical Trials and Technology Transfer

The market Mezion Pharma Co., Ltd. is targeting is that for ADPKD treatments that reduce the burden of long-term use. The company estimates the global market size to be approximately $1.8 billion (2.5 trillion won) as of 2024–2025, with projections indicating it will expand to about $3.2 billion (4.4313 trillion won) by 2035.

The limitations of existing treatments present an opportunity for new drugs. Tolvaptan (Zinac), currently in use, slows the decline in kidney function in adult ADPKD patients at risk of rapid disease progression; however, due to the risk of severe liver damage, regular liver function tests are required. Tests must be conducted before treatment, as well as 2 and 4 weeks after initiation, followed by monthly tests for 18 months and then every 3 months thereafter. Thirst, increased urine output, and frequent urination also pose burdens associated with long-term use.

Mezzion Pharma Co., Ltd. is seeking to differentiate its product based on a distinct mechanism of action and accumulated clinical experience in human subjects. While tolvaptan blocks the signals that cause cysts to grow, udadenafil works by relaxing blood vessels to improve blood circulation within the kidneys. The company expects this approach to reduce kidney damage and inhibit cyst growth and fibrosis.

Preclinical results support this potential. In an ADPKD animal model study conducted by the Mayo Clinic in the U.S., the group treated with udenafil showed statistically significant reductions in both the cyst index—the proportion of the kidney occupied by cysts—and blood urea nitrogen (BUN), a marker of kidney function, compared to the control group.

Kim Yong-cheol, Clinical Associate Professor of Nephrology at Seoul National University Hospital, stated, “The two most important indicators in ADPKD research are cyst size and kidney function,” emphasizing the significance of improvements in both metrics in this trial.

Long-term safety data is another strength highlighted by the company. According to Mezion Pharma Co., Ltd., udenafil has been administered to more than 4,700 children and adults during the development process, and the company has secured data on long-term administration spanning up to five years. The company explained that, based on the clinical data accumulated to date, no signals of hepatotoxicity—such as those seen with tolvaptan—that would warrant restricting development or administration have been observed. However, the therapeutic efficacy and long-term safety in ADPKD patients must be confirmed in future clinical trials.

The newly established U.S. subsidiary will lead the clinical development of ADPKD based on these preclinical results and existing human administration data. A Mezion Pharma Co., Ltd. official emphasized, “We will actively utilize our local U.S. base to accelerate global clinical trials and the FDA approval process, and we aim to realize the value of this new drug at an early stage.”