It’s been almost two years since Paul Grayson was named as CEO of San Diego’s Anaphore—more than enough time for the former Fate Therapeutics CEO to put a new strategy in place.
The company unveiled the first element of its new plan in October—shifting the focus to developing new biologic drugs in China, changing its corporate name to RuiYi, and acquiring worldwide rights to a novel monoclonal antibody for treating rheumatoid arthritis. Earlier this week, RuiYi revealed a deal with CMC Biologics (based in Bothell, WA, and Copenhagen, Denmark) to develop a cell line for producing the monoclonal antibody, dubbed RYI-008.
Today, the San Diego-based biotech says it has entered into a third partnership with Shanghai-based Genor Biopharma to advance development of RYI-008 through clinical trials in China. Details about milestone payments and other terms were not been disclosed.
Grayson explained by phone yesterday that the deals encompass a globe-spanning, four-party partnership (among RuiYi, arGEN-X, CMC Biologics, and Genor BioPharma) that has set out to collectively commercialize novel biologic drugs in China to treat autoimmune diseases and cancer. At a time when most biopharmas in China are focused on developing generic drugs and biosimilars, Grayson says RuiYi has taken a riskier approach by targeting wholly new biological and molecular compounds.
RuiYi’s predecessor company was founded in San Diego in late 2007 to advance new technology for creating genetically engineered protein drugs, with the potential to bind more tightly than traditional antibodies do with their cellular targets. But Grayson said it became clear after he joined the company in mid-2011 that it would take much more time and additional capital to achieve the goals that Anaphore had set for its original technology platform.
“Biology is just hard,” Grayson said. “After a substantial effort, the investors decided that a clear path to a therapeutic, and an exit from that platform would be elusive.”
As Grayson settled into the new job, he proposed changing the focus from broader classes of protein drugs to an exclusive concentration on antibodies, where extensive information about the binding target was already available (to reduce drug development risks) and where there were large patient populations with unmet medical needs. The new focus includes monoclonal antibodies that target G-protein coupled receptors.
In hunting for the right deal, Grayson said Rui-Yi reviewed some 400 prospective antibody drugs before striking a deal with arGEN-X, a Dutch biotech that had devised a proprietary technology platform for making fully human antibodies with therapeutic potential. RuiYi says the arGEN-X technology produces ultra-potent, functionally diverse antibodies against complex disease targets, especially cell surface receptors and highly conserved proteins.
The first of five preclinical stage human antibody candidates that arGEN-X generated from its platform was a novel monoclonal antibody that targeted IL-6, a cytokine widely implicated in cancer and autoimmunity.
The prospective drug is so promising that “anybody who gets passionate about monoclonal antibodies would tear up,” Grayson said. RYI-008 is an unusually long-lasting antibody that could potentially be delivered just once-monthly as an injection just under the skin, Grayson said.
With the drug in hand, Grayson said he wanted to accelerate drug development by signing collaborative agreements with CMC Biologics, the contract biotech drugmaker, and Genor the Chinese biopharma. Genor specializes in commercializing therapeutic monoclonal antibodies, and Grayson says Genor has maintained a good relationship with Chinese drug regulators. As part of the deal, RuiYi’s granted Genor an exclusive license to market the drug in China, where an estimated 4.1 million people suffer from rheumatoid arthritis.
Grayson says RuiYi has not had to raise additional venture capital since 2008—the biotech has raised additional funding through its industry partnerships. As we’ve previously reported, Anaphore raised at least $38 million from Versant Ventures, 5AM Ventures, Apposite Capital, GlaxoSmithKline’s SR One venture group, Merck Serono, and Aravis Venture Associates.
RuiYi still has “almost a year’s worth of cash in the bank,” according to Grayson. “We’ve turned the boat, and now that we’ve got our feet under us, we’ll probably look at bringing some additional people on board. We’re adding value every day.”