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Bayer, CRISPR Therapeutics Form $335M+ Gene Editing Venture

Xconomy Boston — 

Every day, the landmark gene editing system known as CRISPR-Cas9 inches closer towards becoming a real method of treating human disease. It’s no surprise, then, that more and more large biotech and pharmaceutical companies are taking a vested interest in its progress. The latest is Bayer, which has just aligned itself with one of the field’s startups, CRISPR Therapeutics, in a wide ranging pact to create CRISPR-based drugs for a variety of diseases.

Through the pact, Bayer and CRISPR Therapeutics, which has offices in Cambridge, MA, and the U.K., will create a joint venture to discover and develop drugs for blood disorders, blindness, and congenital heart disease. Bayer’s Axel Bouchon— head of the newly created Bayer unit called Bayer LifeScience Center, or BLSC—will be CEO of the joint venture. CRISPR Therapeutics’s CEO and co-founder Rodger Novak will be its interim chairman.

The joint venture doesn’t have a name as of yet, but it’ll be based in London with an office in Cambridge, MA.

Bayer is paying $35 million up front for a minority stake in CRISPR Therapeutics, and will fund the joint venture with at least $300 million in R&D investments over the next five years. Novak said in a statement that his company will get 50 percent of the rights to drugs for blindness, blood disorders, and congenital heart disease that come out of the deal. It’ll also get access to delivery technologies that the new venture comes up with. (Safely and effectively delivering gene editing drugs via CRISPR-Cas9 remains a major challenge for the field.)

If Bayer and CRISPR Therapeutics venture beyond the three named disease areas, CRISPR Therapeutics will get exclusive rights to products for human use, while Bayer would get rights to products for non-human use—say, in agriculture.

The deal is yet another example of CRISPR-Cas9’s growing appeal to larger companies, and the second alliance CRISPR Therapeutics has forged in the past two months. In October, the startup aligned itself with Vertex Pharmaceuticals (NASDAQ: VRTX) in a pact to develop drugs for cystic fibrosis and possibly sickle cell disease.  CRISPR Therapeutics rival Editas Medicine has a deal in place with Juno Therapeutics to develop T cell therapies. Novartis has partnered with another CRISPR startup, Intellia Therapeutics.

All of these companies are now well funded via venture rounds and partnerships, as the technology—a method of genetic surgery derived from a bacterial defense system—inches closer to becoming real medicine, not just one used in research labs. For that, a number of challenges have to be solved, like making sure the molecular scissors these CRISPR drugs use make cuts in the right places, and that the therapies can be delivered without harming people. It all makes for one of biotech’s most fascinating races.

“It´s really exciting to combine the forces of our leading technologies, scientific excellence and intellectual property,” Bouchon said in a statement. “It promises to have a major impact on patients with serious genetic diseases and also for our businesses.”

For more on the deal, check out this story from the Wall Street Journal.