When Cambridge, MA-based Momenta Pharmaceuticals said Monday that it had acquired the scientific assets of neighboring Virdante Pharmaceuticals (NASDAQ: MNTA), few paid much attention, perhaps because of the deal’s small size. Momenta paid just $4.5 million up front, plus additional milestone payments that could reach $51.5 million over time.
But it appears that Momenta is getting a bargain on a technology that was once highly valued by venture capitalists. Just two years ago, Virdante raised $30 million in a Series A funding round from the likes of Thomas, McNerney & Partners, Osage Partners, Biogen Idec New Ventures, Clarus Ventures, MedImmune Ventures, and Venrock Associates. The company’s plan was to develop a technology for increasing the anti-inflammatory properties of antibodies. The science originated at The Rockefeller University in New York.
Now, says Momenta’s CFO Richard Shea, it appears Virdante is “winding down its activities.” Virdante’s demise is not entirely surprising: The “about us” section of its website says the company’s team realized it wasn’t ready yet to enter clinical trials and “that the promise of the technology would be realized best in the hands of a new company.” Virdante’s CEO, John Ripple, declined to comment on the Momenta deal or Virdante’s future.
Shea says he and other executives at Momenta had been tracking Virdante’s progress and had long been interested in the technology, which is dubbed “Sialic Switch.” It’s based on the discovery thatantibodies with sugar molecules called sialic acid seem to tamp down excess inflammation. Virdante’s goal was to boost the anti-inflammatory properties of conventional antibodies by adding sialic acid molecules to them.
So what happened? Shea says it appears Virdante’s founders incorrectly assumed they would be able to take the technology directly from the lab into clinical trials. “I think they found there were some issues they had to work out,” Shea says. “That’s why it’s interesting for us. We have a broad discovery group in this area.”
Momenta’s drug-discovery platform, Shea says, is focused on understanding complex sugars. Virdante’s technology complements that effort, he says. “The Sialic Switch technology not only has the potential to regulate the anti-inflammatory activity of proteins, but it could also enhance the efficacy of existing drugs or even increase their activity. If that’s the case, it opens up the possibility of lowering dosages, which is often an advantage.”
Momenta is best known as a developer of generic drugs. Analysts expect the company to bring in $291 million in sales this year from royalties and profit sharing on a generic version of Sanofi’s anti-clotting drug enoxaparin (Lovenox), which the FDA approved a year ago. Sandoz markets the drug under a deal it formed with Momenta. The FDA is currently reviewing Momenta’s generic form of the multiple sclerosis drug glatiramer, which is marketed today by Teva Pharmaceuticals under the brand name Copaxone.
Momenta is also working on novel compounds—some of which are improvements of existing biotech drugs, and others that represent completely new mechanisms of action, Shea says. The company’s pipeline includes a drug to treat acute coronary syndromes and a novel anti-cancer treatment.
Shea says he’s reticent to put a timeline on the development of the Sialic Switch asset. “The nature of the technology is that it will take some work to get a sense of the timeline,” he says. “Hopefully we can advance it into clinical development fairly quickly.”
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