Alkermes, the Irish biopharma company, announced Wednesday morning that it plans to spin off its oncology unit.

Alkermes said the move to separate its commercial-stage neuroscience business from its oncology unit is part of an ongoing review of strategic alternatives for the latter segment. The board and its leadership said that it believes this move would be in the best interest of patients, shareholders and other stakeholders.

The company stated that spinning the unit into Oncology Co. a pure-play development-stage organization, would “simplify capital allocation decision-making” and “increase its flexibility to pursue growth and investment strategies” more directly aligned with the business goals.

Alkermes’ lead oncology candidate is nemvaleukin alfa, a novel, investigational, engineered interleukin-2 (IL-2) variant immunotherapy.

Looking ahead, Alkermes CEO Richard Pops said the company’s standalone neuroscience business presents a “compelling opportunity” to drive growth and profitability going forward. 

“With nemvaleukin now in two potential registrational studies, the oncology business has a compelling standalone investment thesis anchored by the potential medical and economic value of this potential first-in-class cancer therapy,” Pops said in a statement. “We believe separating the oncology business at this time will best support and position nemvaleukin for success, create value for shareholders, and enable efficient advancement of our preclinical pipeline of engineered cytokines.”

The company did not disclose any financial expectations from the move. However, Alkermes stated that it expects to incur “transactional and separation expenses” as part of the process and will provide a financial update at a later date.

As part of the spin off, Alkermes would maintain its facilities, research and manufacturing operations in Ohio and Ireland while Oncology Co. would be located within the existing campus in Massachusetts. 

The move would be subject to customary closing conditions and approval from Alkermes’ board of directors. The separation is expected to be completed in the second half of 2023.