There’s always some last-minute dealmaking on the eve of the annual J.P. Morgan Healthcare Conference in San Francisco, and this year is no exception. Here are a few of the East Coast highlights to cross Xconomy’s radar screen as we gear up for this year’s festivities.
—Sanofi and Warp Drive Bio have had a unique relationship since the French pharma giant teamed with Greylock Partners and Third Rock Ventures to launch the Cambridge, MA-based biotech with $125 million in tranched financing back in 2012. Namely, Sanofi had what Third Rock partner Alexis Borisy called, at the time of the deal, not just an option to buy Warp Drive at a later date, but “an obligation.”
No longer. This weekend, Sanofi and Warp Drive rearranged their alliance to eliminate the buyout option. Instead, the two companies will work together under a more common arrangement; they’ll develop drugs together, with Warp Drive getting up to $750 million in potential milestone payments and Sanofi the rights to the drugs to emerge from the partnership. The focus of the deal is oncology drugs aimed at cancer-causing genes, such as RAS, and antibiotics for Gram-negative bacteria.
So why the change in the relationship? Warp Drive CEO Laurence Reid wrote in to an e-mail to Xconomy: “because the set of opportunities available through Warp Drive’s platforms is very broad,” the two companies think they can create more value this way. Warp Drive can do deals with Sanofi and other partners—and create products on its own and with the French company. Sanofi can still share in that upside, since it’s making an undisclosed equity investment in Warp Drive as part of the deal.
“Previously, we and Sanofi have been evaluating together the opportunities of our platforms,” Reid wrote. “The reshaped alliance focuses our collaboration on RAS and a class of antibiotics. Warp Drive retains all other rights in the platforms to develop products, alone or with other partners.”
—Cambridge-based Surface Oncology, a cancer drug startup from Atlas Venture, inked its first partnership. The company will get up to $170 million in an alliance with Novartis to develop immuno-oncology drugs. Surface said the payments consist of “upfront, equity, and near-term milestone payments,” though it didn’t break those payments down more specifically. Novartis gets a license to Surface’s lead drug program, and options to grab rights to three others. Surface has the option to retain U.S. rights to “at least half” of the drugs in the collaboration.
The deal “fuels our pipeline, provides the option to co-develop and co-commercialize half of the partnership programs, and allows us to further build value as an independent company as we also pursue new programs outside of the collaboration,” said CEO Detlev Biniszkiewicz , a former AstraZeneca executive, in a statement. I spoke with Biniszkiewicz in May about Surface’s plan to develop next-gen immuno-oncology drugs, beyond the “checkpoint inhibitor” cancer therapies that have come onto the market over the past few years.
—CureDuchenne Ventures, the venture philanthropy organization focused on treatments for Duchenne Muscular Dystrophy, made an unspecified invested in a new North Carolina-based biotech called Bamboo Therapeutics, which is based on the work of University of North Carolina researchers Jude Samulski and Xiao Xiao. Bamboo is developing a gene therapy for Duchenne called BMB-D001 that is currently in preclinical testing. The funding will help move the gene therapy towards clinical trials. (Samulski also co-founded Chatham Therapeutics, a gene therapy startup that Baxter International bought a few years ago for its prospective hemophilia treatments.)
Gene therapy has been tried for Duchenne before, just never successfully. But there has been a good amount of activity recently in the space. Solid GT, a startup founded by former J.P. Morgan Ilan Ganot, raised $42.5 million from Biogen and others in November to develop a gene therapy for Duchenne. And researchers from Duke University published a paper in Science in which they used the gene editing system known as CRISPR-Cas9 to treat Duchenne in mice. CureDuchenne managing director Jak Knowles joined Bamboo’s board as part of the funding.
“We have dedicated our careers to harnessing the power of gene therapy to correct devastating genetic diseases,” Samulski said in a statement. “We are excited to collaborate with CureDuchenne as we move our therapeutic into the clinic.”