Scientists have tried for decades to coax the body’s immune system to hunt down and kill cancer cells, much in the same way it fights viruses and bacteria. The idea has always been to create a standard treatment against tumors that’s more effective and more tolerable than traditional chemo, radiation, or targeted therapy.
The new Seattle-based operation, named after the Roman goddess of protection, has raised the huge sum of $120 million in its Series A venture capital round. The money will enable Juno to carry out an audacious mission to make immunotherapies that it hopes can someday replace the older tools of the cancer trade. The company doesn’t intend to make a conventional pill in a bottle or targeted antibody drug in a vial. Instead, it plans to withdraw blood from individual cancer patients, re-engineer certain immune T-cells from each patient to turn them into super-aggressive cancer cell killers, and then re-infuse the “killer” T-cells back into the body. The great future ambition is to wipe out the tumors and create ongoing immune system memory and surveillance that can potentially keep cancer at bay for years.
Juno is built on a few different technologies that have been decades in the making at institutions such as the Fred Hutchinson Cancer Research Center, Seattle Children’s Research Institute, and Memorial Sloan-Kettering Cancer Center in New York. Arch Venture Partners and the Alaska Permanent Fund, through a partnership with Crestline Investors, are the main financial backers. The three research institutions each have equity or royalty stakes in Juno, although the exact amounts aren’t being disclosed.
The company, which has 11 employees so far, is led by CEO Hans Bishop, the former chief operating officer of Dendreon (NASDAQ: DNDN), the company that won FDA approval in 2010 for the first cell-based immunotherapy against cancer. Although Dendreon failed to live up to the hype in the marketplace with its prostate cancer immunotherapy, it mastered the manufacturing and logistics challenges that go with the territory in a cell-based cancer immunotherapy platform like the one being crafted at Juno.
“The big idea is in exploiting advances in understanding how to manipulate T cells to fight cancer,” said Larry Corey, the president of the Fred Hutchinson Cancer Research Center and co-founder of Juno. “The goal of our company is curative therapies for a wide range of cancers.”
Researchers rarely use words like that, and for good reason, because cancer cells are amazingly adept at developing resistance many of the best targeted drugs of modern molecular biology. Using strong words like “curative” can easily give patients false hope.
It will be years before anyone truly knows whether Juno can reach its goals. But the combination of technology, money, and people rallying around Juno is rarely seen in biotech. The scientific co-founders include Phil Greenberg, and Stanley Riddell from the Fred Hutchinson Cancer Research Center; Michael Jensen of Seattle Children’s Research Institute; and Renier Brentjens, Isabelle Riviere, and Michel Sadelain of Memorial Sloan-Kettering. Rick Klausner, the former director of the National Cancer Institute and current chief medical officer of Illumina (NASDAQ: ILMN), is also a co-founder and member of the board.
“It’s been amazing to watch the last many decades of frustrations about immunotherapy and I must say how impressive it is that the diehards kept at it,” said Klausner, who did pioneering basic research on T-cell receptors in the early ‘80s at the National Institutes of Health. “I think we’re at a huge transition point where immunotherapy will be part of our clinical armamentarium.”
Juno is unusual for a biotech startup, in that it isn’t just hoping to extrapolate results from mice and rats into humans. It has been emboldened by the experience its scientific founders have had, especially over the past year, in treating about two dozen patients with acute lymphocytic leukemia and other malignancies who doctors thought had only weeks left to live.
The Juno researchers showed they were able to trigger a complete molecular response—which means no trace of cancer anywhere in the blood—for 15 of the first 17 patients (88 percent) with acute lymphocytic leukemia in an ongoing clinical trial, Bishop says. Full data haven’t been published in a peer-reviewed journal, or presented at a medical meeting, and Juno isn’t saying anything publicly yet about side effects, how long the remissions are lasting, or whether these patients are living longer, high-quality lives. But the data from that trial, and a few other isolated patient stories, were compelling enough to convince Juno’s investors to bet $120 million upfront for a strikingly ambitious clinical development plan that calls for as many as 13 early-stage clinical trials testing the company’s technology against various forms of cancer in the year ahead.
Bob Nelsen, a venture capitalist who lost a lot of money on an earlier-generation immunotherapy company called Xcyte Therapies, said he was initially skeptical of building a big new company such as Juno. Challenges around manufacturing scale-up, facility costs, logistics, and intellectual property are incredibly daunting with any cell-based immunotherapy company. But Nelsen says he’s gotten over his initial doubts, and now says the $120 million investment is “just the tip of the iceberg.”
The clinical data, in which patients with no other options and weeks left to live achieved an 88 percent complete response rate, is “unprecedented,” Nelsen said. The data convinced him that the bigger risk would be not investing big enough, or not moving fast enough, to seize the opportunity before others. Of course, he was well aware of formidable competition in this field from Carl June’s group at the University of Pennsylvania and his collaborators at Novartis. June and colleagues have reported, in the New England Journal of Medicine, on some quite impressive results with “chimeric antigen receptor modified T-cells,” also known as CART therapy.
While several competing biotech/academic teams have moved in—Cambridge, MA-based Bluebird Bio (NASDAQ: BLUE) and Los Angeles-based Kite Pharma to name a couple—June’s work at Penn has attracted the most attention until now. It was exciting enough to entice Switzerland-based pharma giant Novartis to move ahead a year ago with its own plans to commercialize the new brand of immunotherapy. Nelsen looked over the competitive landscape, and decided to invest in Juno after carefully reviewing the clinical data gathered by the founders.
“Once I saw the data behind Juno, it was a matter of saying ‘OK, how are we going to make this work?’” Nelsen said. “There is no other choice. It’s compelling enough so that there’s no choice but to make it work.”
The financing of Juno comes during what many scientists consider to be the most exciting period ever in immunotherapy. Not long after Dendreon, Bristol-Myers Squibb won FDA approval for an antibody drug called ipilimumab (Yervoy) that releases a molecular brake called CTLA-4, allowing the body’s immune system to fight melanoma. That drug has extended the lives of melanoma patients when most other drugs have failed miserably. Bristol-Myers, Merck, and Roche/Genentech followed up on that achievement by reporting a series of promising results with antibody drugs against targets called PD-1 and PD-L1; those drugs work by removing a cloaking mechanism tumors use to escape the immune system. Researchers everywhere are fired up about the possibility of combining various types of these immunotherapies, which don’t work for everybody, but do appear to work against multiple tumor types and, in some cases, to provoke long-term remissions. The excitement has helped a few other cancer immunotherapy startups raise money, including Cambridge, MA-based Jounce Therapeutics, Seattle-based Immune Design, and Redwood City, CA-based Armo Therapeutics.
Pharma companies were eager to trumpet their preliminary immunotherapy results this year at the American Society of Clinical Oncology meeting, and they are following up those enticing reports by pouring huge resources into this field they once ignored, partly because of promising anecdotal results that couldn’t be repeated in well-controlled trials.
“It’s a very exciting time in immunotherapy. This (Juno) is very exciting,” said Sally Church of Icarus Consultants, who writes for the popular Pharma Strategy Blog, and who has reviewed CART immunotherapy data from June’s group at Penn, as well as the work from the Fred Hutch and Memorial Sloan-Kettering.
So, for the scientifically minded out there, what does Juno really do?
It has two technology platforms, Bishop said. First is the chimeric antigen receptor-modified T-cells (CART) approach. That platform involves taking out some of a patient’s white blood cells—about 150 milliliters of blood—and then enriching the cells to find the desired population of “killer” T cells that are either few in number, or are just not recognizing the hallmarks on cancer cells they should. The company, in its lab, then essentially performs gene therapy on these cells to deliver a specific substance the cells should recognize and attack, known as an antigen, found on the surface of cancer cells. Juno has two different kinds of adeno-associated viruses (AAVs) that it uses to deliver a new receptor that “reprograms” the T cells to make them aggressive cancer killers. One approach uses a lentiviral vector, and another uses a gamma retrovirus to perform the reprogramming, Bishop said.
The entire process, from blood withdrawal to re-infusion back into the patient, takes about 15 days, Bishop said. Juno believes that its approach can be effective not just for blood-borne cancers, but also for tougher-to-treat bulky solid tumors. Scientists don’t know yet whether it’s necessary or desirable to do repeat infusions, and also don’t know whether they can create long-lasting immune memory or surveillance to keep tumors down. That’s something the company will watch closely, Bishop said.
The second main technology at work in Juno is based on what it calls “high-affinity T-cell receptors.” That work starts by looking for T cells that naturally have high-affinity binding capability to specific markers on cancer cells. Once the natural high-affinity T cells have been identified, and clones have been selected and modified, Juno uses the same gene therapy system to transform the T cells so they all express the high-affinity receptor against cancer antigens, Bishop said.
One potential advantage with the second approach is that it should be able to home in on cancer-related proteins that reside inside cells, not just those that are present on the surface of tumor cells, Bishop said.
“It really involves remarkable technologies,” Bishop said. “The breakthrough here I think has come from multiple different advances in the biology, in genetic re-engineering and in manufacturing. Several things have come together to get us to the point we are.”
How did Juno get this far along, with more assets and clinical proof for its programs than many newly minted public companies? Both the Hutch and Memorial Sloan-Kettering have been able to invest over the years in their own industry-like in-house manufacturing capabilities, through a combination of federal grant and philanthropic support. Corey, the president of the Hutch, singled out a $10 million donation pledge that the family of Amazon founder Jeff Bezos made four years ago to the Hutch, which helped the center build up its capabilities beyond what it could otherwise do.
When the technologies started to mature around CART therapy and high-affinity T-cell therapy, Corey said he sought to bundle the technologies together in a big way. The scope of the work was fast exceeding the center’s ability to tap grants from the National Institutes of Health, and it needed an industry partner. The Hutchinson Center never seriously considered a Big Pharma partner, partly because it wanted to continue to work with academic collaborators and maintain a higher degree of control over the strategic direction of the work. Corey didn’t want to see a classically underfunded biotech startup bite off more than it could chew. He talked with Nelsen, an experienced startup venture investor and member of the Hutchinson Center board of trustees, about possibilities. Nelsen ended up running with the idea of a big financial commitment in collaboration with the big money guys from the $48 billion Alaska Permanent Fund, a state-owned corporation funded mostly by oil revenue.
“We were getting grants, but only for 5 or 10 patients at a time, and the studies didn’t have the kind of rigor and numbers required to take this from a boutique therapy into something bigger,” Corey said. “Our goal is to make immunotherapy into front-line therapy for cancer. To do that, we needed a clinical trial program, and the kind of infrastructure that companies use to get FDA licensure. There was the moment to do that, and to recognize that what we needed was an investor committed to cell therapy, committed to a novel form of therapy, a novel distribution system, the personification of personalized care. It was not in the sweet spot of the pharma industry.”
The Hutch is known around the world as the place that pioneered bone-marrow transplantation for certain forms of blood cancer, which is essentially an early form of cell therapy that often results in cures. Although bone-marrow transplants have their issues—with side effects like infections and graft-versus-host disease—they have saved many thousands of lives over the years. That’s the same kind of impact Juno aspires to have, as a pioneer in immunotherapy, Corey said.
To that end, both the Hutchinson Center and Memorial Sloan-Kettering have retained two seats each on Juno’s board of directors. The board isn’t fully put together yet, but currently includes Corey, Bishop, Klausner, and Nelsen.
The Alaska Permanent Fund was set up in the 1970s to manage the state’s vast oil wealth. It isn’t a typical investor in biotech startups like Juno. The fund got involved after Corey says he serendipitously bumped into David Fallace, a senior portfolio manager for the fund, on an Alaska Airlines nonstop flight from Boston to Seattle. Corey remembers they met at Gate A18 at Logan International Airport.
“He was a nice guy. We talked about children, and life, and where you’re from,” Corey said. “He said he was interested in cancer and cancer therapy.” That was enough to get Corey going. About 3.5 hours into the cross-country flight, he had filled Fallace in about the exciting opportunities in cancer immunotherapy. The two agreed to follow up later.
Corey then brought in Klausner for an independent review of the scientific assets in April. Klausner, who was well aware of competing work in June’s lab at Penn, wasn’t sure what to expect. He was a bit skeptical at first, he says, just because institution heads like Corey sometimes have an inflated opinion of the work that goes on under their own organization’s roof.
“I was skeptical I’d see something that would make me say to them ‘This looks so good you ought to jump into this highly competitive space, because you have some real potential,” Klausner said.
The risks, of course, with any new biotech venture are longer than any one news article can contain. Manufacturing scale up, cost, and distribution logistics are obvious challenges the new company will have to address. Getting the right people is always tough, but Nelsen said he’s excited to have “the most qualified person on the planet” to build a cancer cell therapy business in Bishop—who oversaw manufacturing at Dendreon. Nelsen said he’s confident that Bishop will create a focused culture at Juno that’s not about hype, and Bishop said in my interviews with him this fall that he didn’t want to create false hope.
Scientifically, there are some notable effects to watch for. As with any therapy that fiddles with the immune system, researchers have to make sure they don’t go too far and flip a switch into overdrive and cause autoimmunity like rheumatoid arthritis. Church, the cancer consultant, notes there’s a risk in manufacturing mix-ups of cells that could end up giving patients someone else’s cells—a real problem. There’s also data to suggest that CART therapy is so powerful that it may essentially kill tumors so fast that the body has a hard time excreting the waste through the kidneys, which could end up putting patients on kidney dialysis in a worst-case scenario, Church said. That effect, which June’s group has noticed, is called “tumor lysis syndrome.”
Those kinds of questions will all have to be asked and answered at future scientific meetings, and in the scientific literature. Bishop said he isn’t ready yet to talk about when Juno will provide more of the kind of clarity about Juno’s technology, and its body of medical evidence, that people in science and industry obviously want to see.
One final aspect that’s unusual here is the relationship between the Hutch and Memorial Sloan-Kettering. These institutions normally view each other as competitors more than collaborators. The initial force behind Juno came from the Seattle group, but the scientists there felt there was an even bigger opportunity by joining forces and bundling their respective technologies with respected peers at Memorial Sloan-Kettering, Corey said.
All of the key players at Juno interviewed for this story—Corey, Klausner, Nelsen, and Bishop—said they think highly of the competing work in June’s group at Penn, as did independent expert Sally Church. The Juno team, however, said it believes its diverse group of technologies will give it the variety it needs to tailor treatment to certain kinds of malignancies.
Given the amount of excitement in the field, common sense would say the Novartis/Penn and Juno/Fred Hutchinson/Sloan-Kettering efforts—if successful—will naturally invite even more aggressively financed competitors. Some preliminary results from CART therapy are expected to be on display, generating buzz, this weekend at the American Society of Hematology meeting in New Orleans.
“I don’t want to create false hope,” Bishop said. “But what’s most exciting, undoubtedly, is that we have a technology here with the potential, the potential, to provide curative therapy. We have the potential to do that in a way that may ultimately avoid all the lifelong toxicities that can be associated with chemo or radiation. There’s a lot still to be learned. I don’t want anybody to say we’re overreaching even a tiny bit, but it’s the potential of that that makes the company so extraordinary.”
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