Otsuka Pharmaceutical is expanding its pipeline and U.S. reach with an agreement to acquire Waltham, MA, clinical-stage drug developer Visterra for $430 million in cash.
The deal, announced Wednesday, comes nine months after Visterra closed a $46.7 million Series C round to finance clinical development of its antibody drug programs. That financing followed Visterra’s attempt to raise the cash it needed through an IPO, which it withdrew.
Visterra’s technology has its roots in the lab of MIT bioengineering professor Ram Sasisekharan. The platform enables the company to precisely design and engineer antibodies that bind to and modulate its target. Visterra has assembled a pipeline of compounds that include potential treatments for kidney diseases, cancer, chronic pain, and infectious diseases. Visterra’s lead drug, hemagglutinin, is in a Phase 2 study testing it as a treatment for influenza infection.
Visterra’s financial backers include Polaris Partners, Flagship Pioneering, and the Bill & Melinda Gates Foundation. The company has secured additional cash for its research by landing partnerships with other biotechs. Last year, San Francisco-based Vir Biotechnology struck a deal with Visterra to develop up to six antibody drugs for infectious diseases. In addition to an unspecified upfront payment, Vir will pay for the development of any of the drugs it licenses, and could pay Visterra up to $1 billion in milestones should those drugs reach the market.
Otsuka’s drug portfolio includes treatments for cancer, neurological disorders, and kidney diseases. The company, which is headquartered in Tokyo, has U.S. operations in Maryland and New Jersey. When the acquisition is completed, Otsuka says, Visterra will operate as a subsidiary of its U.S. division, keeping its staff and facility in Waltham. The boards of directors of both companies have already approved the transaction, which is expected to close later this quarter.