Karo Bio has announced that it has stopped development of its late-stage cholesterol compound eprotirome and abandoned plans to spin off its preclinical operations. The firm is terminating the Phase III programme on eprotirome after an animal study demonstrated unwanted effects following long-term exposure. The total cost of eprotirome’s Phase III programme was around SEK 300 million Swedish kroner and it has already spent SEK 100 million.
In October 2010 Karo raised $45 million in equity funding to finance the development of eprotirome. In April 20111 the company signed a partnership with Alkem Laboratories to commercialize eprotirome in India In November 2011, Karo Bio said it would be laying off 25 of its 70 staff as it prepared to spin off its preclinical activities but the latter part of the plan has now been halted.
In December 2011 the company signed a collaboration pact with Pfizer focusing on finding drugs which target the RORgamma pathway to fight autoimmune diseases. Under the agreement Pfizer will provide full funding for the research costs and have the exclusive right to market any products that may be developed as a result of the collaboration. Karo Bio may receive up to $217 million in upfront and milestone payments plus royalty fees.