[Edaily Reporter KIM SUNG-JIN ] Celltrion(068270)Attention is focusing on the competitiveness of “KG013,” a new drug candidate for autoimmune diseases that Celltrion acquired from U.S. biotech firm KaiGene for up to 769.5 billion won. This is because two competing treatments targeting the same condition were recently approved in the U.S., and additional competing drugs are also awaiting approval. Celltrion plans to overcome the challenges of being a late entrant by leveraging the drug’s high target binding affinity and long half-life; therefore, the key question is whether it can demonstrate superior efficacy compared to existing treatments in actual clinical trials.

According to the pharmaceutical and biotech industry on the 26th, Celltrion signed an agreement on the 22nd with U.S.-based Kaijin to secure exclusive global development and marketing rights for KG013, a new anti-APRIL antibody drug candidate. The contract is valued at up to $580.5 million (approximately 769.5 billion won), which includes an upfront payment as well as amounts to be paid sequentially upon achieving future development, approval, and commercialization milestones. Following commercialization, royalties based on net sales will be paid separately.

KG013 is a therapeutic agent that inhibits APRIL, a signaling protein involved in antibody production. Its primary Daesang is immunoglobulin A (IgA) nephropathy, a chronic disease in which abnormal IgA-related immune complexes deposit in the renal glomeruli, causing inflammation and impaired kidney function. APRIL inhibitors work by reducing the production of pathogenic IgA, which is involved in the onset of the disease, thereby inhibiting kidney damage.

Two Competitor Drugs Granted Accelerated Approval… Third Treatment Also Nearing Approval

The problem is that competitor drugs are already capturing the market before KG013 has even entered full-scale clinical development. In particular, APRIL inhibitors that recently received approval from the U.S. Food and Drug Administration (FDA) for the treatment of IgA nephropathy are entering the market one after another.

A prime example is “Boizact” (active ingredient: cibepremab) from Japan’s Otsuka Pharmaceutical. Boizact is an antibody therapy that selectively inhibits APRIL and has been on the market since receiving accelerated approval from the FDA last November. Administered via subcutaneous injection once every four weeks, Boizact demonstrated in Phase 3 clinical trials that it reduced proteinuria by approximately 51% compared to a placebo.

On the 22nd, Otsuka Pharmaceutical announced that the final analysis of its Phase 3 trial showed a 97.1% reduction in the risk of composite renal events—defined as a decline in renal function or renal failure—compared to the placebo. Among the 259 patients treated for two years, one experienced a decline in renal function or renal failure, whereas in the placebo group, 28 out of 251 patients developed renal failure. This confirms a clear renal function-preserving effect compared to the placebo. Based on these results, Otsuka Pharmaceutical is pursuing a transition to full marketing approval.

“Trutakna” (active ingredient: atacipcept) from U.S.-based Vera Therapeutics is also considered one of Celltrion’s competing drugs. This drug, which received accelerated approval from the FDA last July, is a dual-target therapy that simultaneously inhibits APRIL and BAFF, a B-cell activating factor. According to a press release issued by Vera Therapeutics on September 15, the estimated glomerular filtration rate (eGFR) at the 52-week mark decreased by an average of 0.11 mL/min/1.73 m² in the treatment group, compared to a decrease of 5.69 mL/min/1.73 m² in the placebo group. eGFR is an indicator of how well the kidneys are actually maintaining their ability to filter blood. Generally, a higher value indicates better renal filtration function.

Competition is expected to intensify further. U.S.-based Vertex’s “pobetacib” is also targeting FDA approval this coming November. Pobetacib is also a treatment that simultaneously inhibits APRIL and BAFF and is administered via subcutaneous injection once every four weeks. According to the company’s announcement, Phase 3 clinical trials confirmed that it reduced proteinuria by 49.8% compared to the placebo at the 36-week mark.

KG013 Highlights “Femtomole Binding Affinity”… Clinical Validation and Contract Structure Are Key

Given that competitors have already secured a foothold in the market for the new drugs Celltrion is developing, analysts suggest that the key issue for Celltrion is whether it can demonstrate superior efficacy compared to other companies.

The competitive edge of KG013, as highlighted by Celltrion, lies in its high target binding affinity. Kaijin, the original developer, explained in a press release issued on the 22nd—the day it signed a licensing agreement with Celltrion—that “KG013 is a half-life-extended, fully human anti-APRIL monoclonal antibody with femtomole-level binding affinity.” A femtomole is a unit of concentration that represents a concentration of 1/1,000 trillionth of a mole of a substance in 1 liter of solution. Since a lower value indicates a stronger binding between the antibody and its target, KG013’s binding affinity at the femtomole level can be interpreted as signifying exceptional binding strength to the target.

The company also highlights the drug’s long-lasting effect in the body as a key strength. Celltrion explained, “We are developing the drug to significantly improve its efficacy and duration of action in the body, enabling effective disease control even with lower doses and longer dosing intervals.” Since competitors have already developed products using a once-every-four-weeks subcutaneous injection regimen, the key question is whether Celltrion can achieve an even longer dosing interval. A Celltrion spokesperson stated, “It is difficult to disclose detailed characteristics of the drug under development.”

Most importantly, KG013 is still in the preclinical stage, so no data has yet been obtained to prove its efficacy in humans. According to Kaijin’s official website, KG013 is currently in the process of preparing an Investigational New Drug (IND) application. Given that two competing drugs are already on the market in the U.S. and additional treatments are undergoing regulatory review, KG013 faces the challenge of not only accelerating its clinical development but also demonstrating differentiated therapeutic effects as a late entrant.

The fact that the market size is not yet very large also poses a burden for a latecomer. According to market intelligence firm S&P Global Market Intelligence, sales of IgA nephropathy treatments are estimated to reach approximately $2.1 billion (about 2.77 trillion won) this year. While the market is projected to grow significantly if new drugs are successfully launched, given the current market size, it is highly likely that competing drugs already on the market will enjoy first-mover advantages.

The contract structure is also worth noting. While the maximum value of this agreement is 769.5 billion won, Celltrion has not disclosed the specific amounts for the upfront payment or the development and sales milestones. Consequently, it is difficult to accurately assess the actual initial investment burden and future payment obligations.

However, last November, Celltrion entered into a deal worth up to $744 million with Kaijin to acquire two new drug candidates for autoimmune diseases, including an FcRn inhibitor; at that time, the upfront payment amounted to only $8 million, or approximately 1.1% of the total contract value. It is expected that the evaluation of this latest agreement will also depend on the amount invested as an upfront payment.

An industry insider stated, “It is difficult to evaluate KG013 since clinical data has not yet been released,” adding, “Given that competing drugs are already on the market, it seems important to accelerate the clinical trials.”