Genentech Pours $95M Into Constellation's Epigenetic Drug Platform

1/17/12Follow @arleneweintraub

Cambridge, MA-based Constellation Pharmaceuticals is announcing today that it has formed a major partnership with Roche’s Genentech unit, based in South San Francisco, to develop treatments for cancer and other diseases. The deal is worth $95 million to Constellation in the form of an up-front payment and research support over the next three years. Constellation—which was founded in 2008 and backed by Third Rock Ventures and other leading VC groups—may also receive milestone payments and double-digit royalties on any products that come out of the alliance.

This is by far Genentech’s biggest bet to date on epigenetics—the science of understanding and addressing molecular changes in cells that activate or de-activate disease-causing genes—says James Sabry, vice president of Genentech Partnering. “This is a a once-in-a-decade type of deal for us,” Sabry says. And while there are plenty of other startups working in the field, Genentech chose Constellation for the quality of its scientific progress so far, Sabry says. “Epigenetics is a huge evolving area of biology representing hundreds of new targets,” he says. “We actually sat down on the bench with Constellation’s scientists and we felt the quality of their work was akin to ours.”

For Constellation, the deal is a stamp of approval on a broad-based strategy that the company put in place the day it was founded, says CEO Mark Goldsmith. Constellation is pursuing three classes of enzymes that affect chromatin—the combination of DNA and the proteins that the DNA is wound around in the cell’s nucleus. Those enzymes are commonly referred to as “writers,” “readers,” and “erasers,” because some place chromatin markers that control the epigenetic process, others read those marks, and still others erase them. While several startups have targeted one or another of the classes, Constellation has developed a platform that can uncover drug candidates in all three of them. “From the outset we have emphasized breadth and depth as a differentiating approach,” Goldsmith says.

Genentech's James Sabry

The two companies will collaborate to identify drug targets and lead molecules in a joint steering committee. The initial focus will be oncology, though the companies expect to identify other disease targets as they learn more. A team of Genentech scientists will work closely with Constellation’s researchers, with the common goal of moving as many drug candidates forward as possible, Sabry says. “They will feel like we’re all one company,” he says.

Goldsmith adds that Genentech’s input will be invaluable to furthering the startup’s progress. “The momentum we already established in R&D is now married with the rigorous scientific input of Genentech, which is well known for its ability to translate scientific benefits to patients,” he says.

There are two features of Constellation’s deal with Genentech that make it stand out from other such drug-discovery alliances. First, Constellation will retain exclusive rights to its two most advanced programs, which focus on … Next Page »

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