Johnson & Johnson (XNYS-J&J) is reportedly in advanced discussions to acquire Protagonist Therapeutics, a clinical stage biopharmaceutical company specializing in peptide-based therapies. The potential deal, has sparked investors enthusiasm, sending Protagonist’s shares soaring over 30%, with the company’s market capitalization reaching approximately $4.2 billion.
The acquisition would deepen J&J’s existing partnership with Protagonist, particularly around the development of icotrokinra, a first in class oral peptide targeting the interleukin-23 (IL-23) receptor. Icotrokinra is being evaluated for multiple immune-mediated conditions, including plaque psoriasis, ulcerative colitis, and psoriatic arthritis. Analysts at Leerink Partners have projected peak global sales of up to $9.5 billion, positioning icotrokinra as one of the most impactful immunology launches of the decade.
Recent Phase 3 trial results have demonstrated icotrokinra’s superiority over existing treatments, including Bristol Myers Squibb’s Sotyktu, in achieving skin clearance in psoriasis patients. The drug also showed promising efficacy in ulcerative colitis, with a 63.5% clinical response rate in mid-stage trials, significantly outperforming placebo. Beyond icotrokinra, Protagonist is advancing rusfertide, a late-stage injectable therapy for polycythemia vera, a rare blood cancer. Developed in collaboration with Takeda Pharmaceutical, rusfertide met its Phase 3 endpoints, showing a significant reduction in the need for phlebotomy and improved hematocrit control. Takeda holds exclusive commercialization rights outside the U.S., while Protagonist retains co-commercialization rights domestically under a $300 million licensing agreement.
The potential acquisition aligns with J&J’s strategic efforts to revitalize its immunology portfolio, especially as its blockbuster drug Stelara faces declining sales due to biosimilar competition. By integrating Protagonist’s pipeline, J&J aims to secure next generation assets that offer both innovation and commercial viability.