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Roche Buys Inception 5 MS Program, Versant Funds New Venture

Xconomy San Diego — 

When Versant Ventures, Roche, and Inception Sciences came together in 2014 to identify drugs that could repair damaged neurons, they were placing a bet on technology that amounted to a promising tool in a broader quest to find new ways to treat multiple sclerosis.

Now, San Francisco-based Versant is offering validation of that bet, although many details remain under wraps.

In a statement today, Versant says Roche has acquired the program dubbed “Inception 5,” which was focused on identifying small-molecule drugs to treat MS. As Xconomy reported in 2014, the program’s team intended to use a high-throughput assay technology developed at UC San Francisco to screen compounds in Roche’s libraries. The Inception 5 team also would advance promising compounds. Roche provided funding for the Inception 5 program, which was housed at the San Diego facility of Inception Sciences, a drug development incubator created by Versant and Inception CEO Peppi Prasit, a renowned drug hunter.

A Versant spokesman declined to say how much financial support the Swiss pharma giant provided for Inception 5. But the results must have been encouraging enough for Roche to bring the program in-house. Financial terms of the transaction also are being withheld, so it’s hard to calibrate the significance of the deal.

But the Inception 5 program’s results apparently were encouraging enough for Versant to also launch a new San Diego-based startup called Pipeline Therapeutics to advance the next generation of therapies that might repair damage to the nervous system. The new company’s leadership includes Brian Stearns and Daniel Lorrain, who led the drug-hunting team at Inception 5.

Versant describes Pipeline Therapeutics as a “successor company” of the Inception 5 program, and Versant is the sole backer so far. The venture firm has committed $25 million to the startup, Versant managing director Brad Bolzon said in a recent interview.

Clare Ozawa, a Versant managing director and chief operating officer at Inception Sciences, will assume responsibility for launching Pipeline and raising additional capital. Versant said it expects to seek other investors and industry partners sometime next year.

Bolzon described Inception Sciences as a “perpetual engine” for drug discovery and company creation. (He acknowledged the name was inspired by the perpetually spinning top from the 2010 science fiction movie “Inception.”) Inception’s business model maintains a core team of roughly 40 scientists who work together to identify small-molecule drugs with the potential to treat a variety of diseases and disorders. The idea is to advance a series of drug development programs to a proof of concept—generally taking things as far as an investigational new drug application—and profitably spin out each program as an independent company or sell the technology to a pharmaceutical partner.

In the case of Inception 5 (the fifth program at Inception Sciences), the idea was to screen Roche’s vast libraries of compounds for small-molecule drugs with the potential to repair myelin—the substance that surrounds and protects neurons. It is akin to the flexible plastic material that insulates and protects electrical wiring.

Multiple sclerosis is an autoimmune disease in which the body’s immune system attacks myelin, leaving holes in the protective sheathing. As a result, a patient’s nervous system starts to short-circuit, leading to an unpredictable range of neurological symptoms.

Much still remains shrouded here, but a regenerative therapy that repairs such damage could some day be a big deal for people diagnosed with multiple sclerosis. By some estimates, MS affects roughly 400,000 people in the U.S. alone, with MS-related healthcare costs estimated to be more than $10 billion annually a year.