East Coast Biotech Roundup: Juno, Editas, Celgene, & More
The holidays are in full swing, as are some big startup ideas that have had the biotech world buzzing over the past few weeks. Those stories and more as the roundup returns from a Thanksgiving break:
—Juno Therapeutics earned the distinction this week of having one of the largest bets ever placed on a biotech startup. The company, based on research at institutions in both New York and Seattle, raised a whopping $120 million in Series A cash to support a plan to make new types of cell-based cancer immunotherapies. Juno’s plan is to essentially extract T-cells from a patient, re-engineer them into cancer killers, and infuse them back into the body. The audacious hope is that this method could produce “curative therapies for a wide range of cancers,” Juno co-founder Larry Corey told Xconomy’s National Biotech Editor, Luke Timmerman.
—Juno wasn’t the only new big science idea to take shape in the past few weeks. Cambridge-based Editas Medicine bagged $43 million from Polaris Partners, Third Rock Ventures, and Flagship Ventures, to try to create a new class of drugs based on what it calls “gene editing,” a similar, yet different, concept than gene therapy. Editas’ big idea is to target disorders caused by a singular genetic defect, and create a drug that can “edit” out the abnormality so that it becomes a normal gene—potentially, in a one-time shot. It hasn’t disclosed how it plans to apply this process just yet, however.
—Summit, NJ-based Celgene (NASDAQ: CELG) has made yet another big early-stage development deal. This time, it paid Redwood City, CA-based OncoMed Pharmaceuticals (NASDAQ: OMED) about $177 million up front and tied $3.15 billion in future milestone payments to a deal to work with OncoMed on a series of drugs designed to attack cancer stem cells. The two will team to develop and commercialize as many as six anti-cancer stem cell antibodies, and certain small-molecule drugs, from OncoMed’s pipeline. Celgene has made a number of deals like this over the past few years with the likes of Agios Pharmaceuticals (NASDAQ: AGIO), Epizyme (NASDAQ: EPZM), and Acetylon Pharmaceuticals, among other startups.
—Cambridge, MA-based Visterra pocketed $8.1 million in venture cash this week and filled out a revamped management team to bring an antibody it hopes can fight off all types of influenza. The new cash, which will help Visterra move into its first clinical trials, represented the third and final tranche of a $34.2 million Series A round that Visterra began raising last year. Visterra also added ex-Amag Pharmaceuticals (NASDAQ: AMAG) executives David Arkowitz and Greg Miller to its management team, which is already headed by former Amag CEO Brian Pereira.
—Cambridge-based Zafgen capitalized on some encouraging results from a mid-stage clinical trial of its obesity drug candidate, beloranib, by grabbing a $45 million Series E round from a group of private and public investors. RA Capital Management, Brookside Capital, Venrock, Alta Partners, and other unnamed investors provided the cash, which will help bankroll beloranib’s development. Zafgen’s statement didn’t outline what its specific next steps in development will be.
—Big Pharma helped both the New York and Boston biotech ecosystems this week. In Manhattan, Celgene and Eli Lilly (NYSE: LLY) joined with GE Ventures and the New York City Economic Development Corp. to help put together a $100 million fund whose goal is to create 15 to 20 local biotech startups by 2020. The four entities have put $50 million into the fund; the NYCEDC is in the process of selecting a venture capital firm to take care of the remaining cash. In Boston, meanwhile, Boehringer Ingelheim Venture Fund (a private equity fund established by Germany’s Boehringer Ingelheim) has opened an office in Kendall Square. Boehringer said it plans to invest up to $130 million in new Boston biotech startups, or as much as $13 million per company.
—Lexington, MA-based Cubist Pharmaceuticals (NASDAQ: CBST) began to see the dividends from its 2009 buyout of Calixa Therapeutics as an antibiotic it acquired in the deal, CXA-201, hit its mark in the first of two late-stage clinical trials. The success of the trial even surprised sell-side analysts because CXA-201 performed better than the standard of care, generic levofloxacin, at treating patients with complicated urinary tract infections. Cubist’s shares soared to record highs following the news.
—Job cuts aplenty were announced in the Boston/New York biotech scene this week. Japan-based Eisai revealed plans to restructure its R&D operations, and will cut about 130 jobs as a result—with many of them coming in Andover, MA. And New York-based Forest Laboratories (NYSE: FRX), behind new CEO Brent Saunders, wants to save $500 million partly by shedding $110 million in salaries.
—Investors appeared to start buying into Cambridge-based Merrimack Pharmaceuticals’ (NASDAQ: MACK) idea that a group of failed mid-stage clinical trials of cancer drug MM-121 are helping it identify positive biomarkers that it will use to propel a streamlined Phase III study. Although MM-121 missed the primary goal of yet another trial, this time in breast cancer patients, Merrimack again pointed to a subset of patients with a prespecified set of biomarkers that it said responded better to its drug than those who didn’t have the markers. The biomarkers, found in 31 percent of the patients in the breast cancer study, were the same ones that Merrimack identified in a previous ovarian cancer study, which the company says confirms its hypothesis that the markers are meaningful. Merrimack stock has risen close to 50 percent since releasing the data on Nov. 26, although it is still down quite a bit from its 52-week high.
—Parsippany, NJ-based Medicines Co. (NASDAQ: MDCO) agreed to pay $140 million up front, and potentially as much as $474 million total, to acquire San Diego, CA-based Rempex Pharmaceuticals. The deal gives Medicines Co. Rempex’s pipeline of drug candidates that fight common infections seen in hospitals. It’s the second acquisition for Medicines Co. in the past six months. The New Jersey company bought Netherlands-based ProFibrix for $240 million in June.
—New Brunswick, NJ-based Johnson & Johnson (NYSE: JNJ) won FDA approval of its hepatitis C drug simeprevir. It’ll be sold under the brand name Olysio. The drug, developed with partner Medivir, will figure into the all-oral interferon-free cocktail regimens being developed to treat the disease.