So much money has flowed into Moderna Therapeutics, it was only a matter of time before the company started spending real dough.
Cambridge, MA-based Moderna, which is developing a new class of messenger RNA molecules as therapies, says it’s investing $20 million to spin out a new company called Onkaido Therapeutics. The new shop will begin life with 15 different cancer drug candidates that had been in preclinical testing at Moderna.
Stephen Hoge, the senior vice president of corporate development at Moderna, is taking on the added role of CEO at Onkaido. Peter F. Smith, formerly the head of non-clinical discovery and development at Millennium Pharmaceuticals, is joining Onkaido as the founding chief scientific officer. Hoge’s role is to set up the venture, and the lay the foundation for a full-time veteran CEO, says Moderna CEO Stephane Bancel. For now, Moderna is the sole owner of Onkaido, although it will look to bring in private or public investors later, Bancel says.
Moderna burst onto the biotech scene over the last year with a string of high-profile deals and financings to support its new class of messenger RNA therapies. AstraZeneca plunked down $240 million up-front for the right to develop these treatments for cardiovascular, metabolic and kidney disorders, while the Defense Advanced Research Projects Agency paid $25 million to support new mRNA drugs against infectious diseases. Earlier this week, Cheshire, CT-based Alexion Pharmaceuticals (NASDAQ: ALXN) poured $125 million into Moderna for rights to develop mRNAs against rare diseases.
Moderna also raised $110 million in private equity financing last year, giving it the biggest war chest of any biotech startup company in the world, by far.
Careful readers will notice that none of those deals covered the cancer market, one of the biggest pharmaceutical markets of all. And one of Moderna’s key tests last year was to show that it could inject a messenger RNA into animals, get the molecule inside cells, and enable the cellular machinery to churn out fully functional therapeutic antibodies. One of those antibodies was a hit drug for breast cancer, trastuzumab (Herceptin).
Onkaido isn’t yet saying which cancer targets it plans to pursue, or which drugs it plans to make. It intends to remain stealthy for its first 12-18 months, much like the parent company. “It served us well,” Bancel says in an e-mail.
Moderna decided to split out a new cancer company in part to help with focus. The parent company is planning to invest $100 million this year in further developing its technology platform, and “we can’t do both extremely well at the same time,” Bancel says.
Moderna’s five-person oncology R&D group is splitting off to join Onkaido, Bancel says, and the new company will now look to do some more hiring of its own.
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