Alkermes announced that it has received a $50 million payment from Biogen after a review of preliminary data related to the gastrointestinal tolerability of BIIB098 (diroximel fumarate), now in pivotal clinical studies as a possible treatment for relapsing forms of multiple sclerosis (MS).

BIIB098, formerly known as ALKS 8700 and licensed for commercialization by Biogen in a 2017 agreement with Alkermes, converts to a monomethyl fumarate (MMF) molecule that the companies believe may be superior to dimethyl fumarate (Tecfidera), an FDA-approved oral therapy for relapsing forms of MS.

While its mechanism of action is not fully understood, BIIB098 is known to rapidly convert to monomethyl fumarate in the body. Its immunomodulatory nature and anti-oxidant properties could help to protect the myelin sheath that insulates nerve fibers without leading to immune suppression.

BIIB098 was designed to differ from Tecfidera in ways that would benefit patients, in particular by having fewer gastrointestinal side effects.

“The clinical data generated from this program underscore the potential value of BIIB098 for patients with multiple sclerosis,” Richard Pops, chief executive officer at Alkermes, said in a press release.

Alkermes also said that it hopes to submit a New Drug Application (NDA) for BIIB098 to the U.S. Food and Drug Administration (FDA) by year’s end. 2018.

BIIB098’s Phase 3 clinical development program includes pharmacokinetic studies to establish its bioequivalence to Biogen’s Tecfidera, as well as data from a two-year Phase  3 safety study known as EVOLVE-MS-1 (NCT02634307).

EVOLVE-MS-1 is an open-label trial, enrolling by invitation more than 900 patients with relapsing-remitting MS, to evaluate the long-term safety and tolerability of BIIB098 taken as oral capsules twice a day. Safety and will be measured by records of side effects at 96 weeks; this trial is due to conclude in December 2020.

Another Phase 3 study, EVOLVE-MS-2 trial (NCT03093324), is investigating the gastrointestinal tolerability of oral BIIB098 in direct comparison to oral Tecfidera in about 420 people with relapsing-remitting MS — one group taking 462 mg twice daily of BIIB098, the other 240 mg twice daily of Tecfidera. The trial’s primary goal is measures of the days with gastrointestinal “events” in patients after five weeks. This study is due to conclude in February.

In a previous Phase 1 study (NCT02201849), BIIB098 was evaluated for its safety, tolerability and pharmacokinetics in comparison to Tecfidera and placebo. Results showed that BIIB098 meet the standards for bioequivalence to Tecfidera.

Under the terms of the agreement, Alkermes will receive royalties on worldwide net sales of BIIB098, while Biogen retains a global license to commercialize the medication.

Alkermes may also receive a $150 million milestone payment from Biogen if the FDA approves BIIB098 on or before Dec. 31, 2021, the release states.