Janssen Biotech, part of pharma and consumer goods giant Johnson & Johnson, has entered into a global development and commercialization agreement with Theravance Biopharma Ireland for new treatments for  inflammatory bowel disease (IBD), including Crohn’s and ulcerative colitis.

Plans center on TD-1473, a novel, potent, orally administered and intestinally restricted pan-Janus kinase (JAK) inhibitor in clinical development, which has the potential to treat a range of inflammatory intestinal diseases.

Theravance said the drug differs from other oral JAK inhibitors in that it is specifically designed to act directly at the site of inflammation in the intestinal wall, thereby limiting systemic exposure.

“Internally, we have been very excited about the potential of TD-1473 to serve as a transformational medicine designed to offer the proven therapeutic activity of JAK inhibitors without the safety concerns associated with systemic JAK exposure,” said Rick Winningham, chairman and CEO of Theravance Biopharma Group. “We believe this transaction can accelerate the development of TD-1473 and maximize the potential value of the program to Theravance Biopharma.”

Under the terms of the agreement, Theravance will get an upfront payment of $100 million as well as further potential payments amounting to $900 million, if Janssen decides to remain in the collaboration following the completion of certain Phase 2 activities.

The companies will share profits in the US and expenses related to a potential Phase 3 program - 67% to Janssen and 33% to Theravance. In addition, Theravance will receive double-digit tiered royalties on any sales outside the US.

During 2018, Theravance plans to start a large Phase 2b/3 study for TD-1473 in ulcerative colitis as well as a Phase 2 study in Crohn’s disease. Once the studies are completed, Janssen can choose to enter into an exclusive arrangement by paying a fee of $200 million to Theravance.

Janssen said IBD is an area of great unmet need with 5 billion people around the world affected by the disease.