Acceleron, Bucking Conventional Wisdom, Pushes Ahead Drug For Bone Loss, Anemia

9/11/09Follow @xconomy

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its lab and office space on Cambridge’s Sidney Street by almost 20,000 square feet. The company, has been boosting its headcount by 50 percent a year since it was founded in 2004, and now has about 150 employees, Knopf says. It has a deep-pocketed partner in Summit, NJ-based Celgene (NASDAQ: CELG) to help with further development of ACE-011, and has pulled in $87 million in venture capital so far from big-name investors that include Advanced Technology Ventures, Bessemer Venture Partners, Flagship Ventures, MPM Capital, OrbiMed Advisors, Polaris Venture Partners, Sutter Hill Ventures, and Venrock Associates.

The company’s founding idea was to corral world-class scientists who were focused on a superfamily of proteins known as growth and differentiation factors. Other companies that looked at therapies directed at these proteins saw them as tough to work with and impractical as drugs because they were insoluble.

Acceleron has sought to solve that problem by taking a page out of Amgen’s playbook. Acceleron has made drug candidates the same way as Amgen’s etanercept (Enbrel), which is a genetically engineered fusion protein that’s soluble in the bloodstream. That makes the Acceleron drug practical in a marketing sense, because it can be given through a self-administered injection just under the skin, once a month or maybe even less frequently, Knopf says.

Celgene paid $50 million upfront to Acceleron in February 2008 for the right to co-develop ACE-011. The announcement at that time only disclosed promising results for the experimental drug’s ability to spur formation of bone, and didn’t say anything about also boosting red blood cell production. Ten months later, results from a Phase I clinical trial on the drug’s ability to boost bone formation, and hemoglobin scores (a marker of red blood cell levels) were published in the Journal of Bone and Mineral Research.

The two companies have worked to build on the early momentum with a pair of more rigorous mid-stage clinical trials of patients with multiple myeloma (a malignancy of the bone marrow), and breast cancer. Results from the bigger multiple myeloma study are expected to be presented at the American Society of Hematology meeting in December. The companies haven’t said anything publicly about the findings, but the myeloma results gave them the confidence last month to invest more money, starting the breast cancer study in 105 patients.

Since the FDA has issued several warnings to physicians about the dangers of giving too high a dose of the Amgen drugs, I wondered whether Acceleron is doing anything extra careful to make sure its drug doesn’t fall into the same trap by treating anemia and causing heart attacks. Ertel said Acceleron hasn’t seen signs of that, and his view is that essentially Acceleron has sidestepped that risk by stimulating the red blood cells in a fundamentally different way.

Celgene is paying an undisclosed share of the development costs of this drug, but since Acceleron raised its last round of venture capital in October 2007, I had to ask whether it will need to raise more money to keep going. Acceleron isn’t saying how much cash it has left, but Knopf says he’s looking to partners to help foot the bills, particularly for its two other drugs in development—ACE-031 for increasing muscle mass, and ACE-041 to cut off blood flow to tumors.

Acceleron sure sounds like it is looking to strike another deal with its ACE-031 drug candidate. Knopf talked it up a fair bit during our conversation Wednesday, and just yesterday, Acceleron presented data at a medical meeting in Switzerland that shows the drug increased lean body mass and muscle volume in a small clinical trial.

“The drive here is for a partnership,” Knopf says. “We’re in an enviable position.”

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