PvP Biologics Raises $35M in a Lab-to-Pharma Deal with Takeda

Xconomy San Diego — 

[Corrected 1/5/17, 8:07 am to show company was spun out of UW two months ago.] A San Diego-based startup spun out from the University of Washington just two months ago is today announcing a $35 million deal with Takeda, Japan’s biggest pharmaceutical.

PvP Biologics was founded to advance KumaMax, a synthetic enzyme (depicted in the above image) that shows promise as an oral drug for treating celiac disease. Almost from the beginning, the idea was to forego traditional venture financing and go straight to a pharma deal, PvP CEO Adam Simpson said by phone yesterday.

“It’s a very innovative transaction,” Simpson said.

Takeda agreed to provide all $35 million in exchange for an exclusive option to acquire PvP once the biotech has completed a pre-determined drug development plan and delivered a pre-defined data package for KumaMax. Takeda’s funding is intended to take the biologic drug through phase 1 proof-of-principle studies, Simpson said.

In a joint statement, Takeda and PvP Biologics describe KumaMax as an engineered, recombinant enzyme that remains active in the highly acidic conditions of the stomach. It has a “high specificity” for gliadin, a gluten fragment that triggers an immune response for some people that can lead to celiac disease.

“People with celiac disease mount an immune response to these incompletely digested gluten fragments as they pass into the intestines,” said Ingrid Swanson Pultz, a leader in computational enzyme design at the University of Washington’s Institute for Protein Design, which originally developed KumaMax. The enzyme has the potential to degrade the immune-reactive fragments of gluten before they move into the  intestines, where the immune response wreaks havoc, PvP said.

(Pultz provided the computer-generated image of the KumaMax enzyme, created by Vikram Mulligan at the University of  Washingon, depicting how KumaMax envelops a gluten protein fragment, shown as a yellow-green structure.)

“There’s currently nothing on the market for celiac disease, nothing that’s FDA-approved,” Simpson said. “We think it’s a tremendous unmet need.”

According to PvP Biologics, the only current treatment for celiac disease is a strict gluten-free diet, which can be challenging to maintain. The company estimates that 1 out of 100 people worldwide suffer from celiac disease, including some 2.4 million Americans. Symptoms include acute gastrointestinal distress, malnutrition, weakness, and failure to thrive.

The company takes its name from the idea that the team is using one protein (KumaMax) to target another protein (gluten), as in “protein vs. protein,” Pultz said. PvP also alludes to a player vs. player video game that is popular among students and scientists at the Institute for Protein Design.

Pultz, a PvP co-founder and chief scientific officer, said she was the first translational science investigator hired at the institute, and took up work on the enzyme as her first post-doctoral project. Pultz said a group of University of Washington undergraduates initially identified the enzyme as an ideal exercise for using computer-based protein design, and took on the project as their 2011 entry for the International Genetically Engineered Machine Competition. The UW team won the top prize; marking the first time a U.S. team had ever won the global competition in synthetic biology.

Pultz, who helped the UW team, said she resumed work on the molecule in 2014, under a grant for translational medicine. The company was officially founded in 2012, but as she put it, “We were able to stay at the university and incubate.”

In early 2016, Pultz said, Tadataka “Tachi” Yamada, a venture partner at Frazier Healthcare Partners, joined the effort. Yamada, who is chairman of the advisory board at the Institute for Protein, was previously an executive vice-president, chief medical and scientific officer, and a board member of Takeda Pharmaceuticals. Yamada has had a remarkably successful life sciences career, which includes stints as the editor of The Textbook of Gastroenterology and the president of the American Gastroenterological Association, Pultz said.

Yamada’s experience in developing G.I. drugs and his connections with scientists and experienced biotech executives brought the company to San Diego, Simpson said. Several key executives worked previously at Meritage Pharma, which was acquired by Shire in 2015 for an estimated $245 million.

“It was Tachi’s vision initially to go straight to pharma,” Simpson said. “From there, it was a relatively short list of people to go to who had G.I. experience.”

PvP Biologics now has eight employees, but has plans to add two more in coming months, along with a variety of consultants Simpson said. The senior management team includes chief development officer Malcolm Hill, program management director Linda Gieschen, and Mark Mugerditchian, senior vice president for manufacturing and product development.