Welcome to the latest edition of our weekly EuroBiotech Report. Bayer became the most recent biopharma to tap Dutch biotech arGEN-X for its llama-based antibody discovery platform. Eli Lilly ($LLY), another of arGEN-X's partners, also made the news by making its first-ever investment in a British venture fund, the £47.5 million ($79.5 million) early-stage pool gathered by Epidarex. Oxford BioMedica had money on its mind too. The British biotech hopes to raise £25.7 million to finance its gene therapy pipeline now that it can no longer rely on income from Sanofi ($SNY). It was a week of firsts in Germany and neighboring Czech Republic. Neuway Pharma became the first startup to graduate from Germany's Life Science Inkubator, raising money to fund its orphan drug development ambitions in the process. Across the border in Czech Republic, billionaire-backed Sotio said it had become the first biotech from central and eastern Europe to take an immunotherapy into Phase III. And more. Nick Taylor (email | Twitter)
1. Bayer joins Lilly, Shire on arGEN-X's roster of biopharma partners
2. Lilly commits cash to £48M early-stage U.K. venture fund
3. Billionaire-backed Czech biotech moves immunotherapy into PhIII
4. Oxford BioMedica plans £26M fundraising to finance gene therapy development
5. CNS startup becomes first spinout from German incubator
And more >>
Bayer joins Lilly, Shire on arGEN-X's roster of biopharma partners
Having struck deals with Eli Lilly ($LLY) and Shire ($SHPG) within a few years of being founded, Dutch biotech arGEN-X has now burnished its list of collaborators with another leading biopharma: Bayer. As in the earlier deals, arGEN-X's antibody discovery platform is the centerpiece of the collaboration.
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| Tim Van Hauwermeiren and colleagues--Courtesy of arGEN-X |
Bayer is paying an upfront fee to access the technology--which uses llamas to find antibodies--and is also on the hook for milestones related to success with technical issues, clinical trials, regulators and sales. The first step is to discover the antibodies, with arGEN-X applying its llama-based platform to undisclosed targets across multiple therapeutic areas submitted by Bayer. By using llamas' immune systems to generate antibodies, arGEN-X thinks it can find candidates for targets that are beyond the reach of other discovery platforms.
Lilly was the first to sign up to use the technology, inking a deal with arGEN-X back in 2011. A deal with Shire followed the next year. Shire paid milestones relating to in vivo proof of concept for one of its ongoing antibody discovery programs in January, while progress with the Lilly collaboration has also triggered paydays for arGEN-X. The income supplements the biotech's fundraising efforts, which last yielded results in November when PMV added €5 million in an extension of a Series B round. When the round first closed in 2011 it was worth €27.5 million to arGEN-X.
The cash is being used to advance arGEN-X's in-house candidates, two of which are now in the clinic. A Phase Ib trial of CD70-targeting antibody ARGX-110 ended in January, after which arGEN-X began a yearlong safety and efficacy expansion study. The biotech also has a c-Met antagonist, ARGX-111, in Phase Ib, with expanded safety data and initial efficacy results due in the second half of 2015, arGEN-X CEO Tim Van Hauwermeiren told FierceBiotech. Around that time arGEN-X plans to move ARGX-113 into the clinic.
Van Hauwermeiren is targeting in-house programs at rare diseases, with the Bayer, Lilly and Shire partnerships providing the company with access to major indications. Once the in-house programs reach a certain stage, arGEN-X will look to partner the drugs. "We currently intend to progress ARGX-110 and ARGX-113 up to clinical proof-of-concept, and possibly beyond, whilst we will aim to partner ARGX-111 after the Phase Ib proof-of-mechanism," Van Hauwermeiren said. - read the release and FierceBiotech's take
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Lilly commits cash to £48M early-stage U.K. venture fund
In the many articles written about British bioscience during Pfizer's ($PFE) pursuit of AstraZeneca ($AZN), the idea that the country is great at doing science, but rubbish at commercializing it, came up again and again. Now Eli Lilly ($LLY) is trying to remove the financial barriers between science and business by committing "significant capital" to a £47.5 million ($79.5 million) life science fund.
Venture capital shop Epidarex raised the cash from Lilly, King's College London and other investors to fund early-stage life science companies in the United Kingdom. Epidarex started the fund last year from its offices in Edinburgh, Scotland, with cash from local universities. Since then, Lilly has come on board, helping the money controlled by the fund to almost double from its initial pool of £25 million. With Epidarex specifically targeting early-stage investments, the fund is big enough to have a notable effect on the startup landscape.
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| Chris Mottershead--Courtesy of King's College Hospital |
In doing so it could help projects get out of academia and into an environment in which they can start benefiting patients. "These funds provide the much-needed capital to carry translational research from the laboratory to the commercial market," Chris Mottershead, VP of research and innovation at King's College London, said in a statement. As well as tapping King's College for investment, Epidarex views its partner as a source of potential startups. The fund hopes to benefit from its close relationship to universities in Aberdeen, Edinburgh and Glasgow, too.
Having made its first-ever investment in a U.K. venture fund, Lilly is now positioned to get an early look at science emerging from these labs. The University of Edinburgh is behind one of Epidarex's first U.K. investments, Edinburgh Molecular Imaging. EMI spun out of the university to develop molecular imaging technology and snagged a £4 million Series A investment from Epidarex to fund the work. - read the release, FierceBiotech's take and the Telegraph's story
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Billionaire-backed Czech biotech moves immunotherapy into PhIII
A Czech biotech owned by the country's richest man has begun enrolling patients in a Phase III trial of its prostate cancer immunotherapy. For the company, Sotio, and the broader Czech biotech sector, the 1,170-person trial represents a landmark.
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| Petr Kellner--Courtesy of Generali |
Sotio was founded in 2010 to develop a treatment that was first discovered by researchers at Prague's university teaching hospitals. In 2012 Czech billionaire Petr Kellner's company PPF entered the biotech sector by acquiring Sotio and has supported the startup through mid-phase trials. Having successfully navigated these studies, Sotio has enrolled the first of an anticipated 1,170 people in a Phase III trial that will use sites in the U.S. and 19 European countries, Bloomberg reports.
The company thinks it is the first biotech from central and eastern Europe to take an immunotherapy into Phase III. Technical challenges in manufacturing and other areas make immunotherapies a tough class of drugs to develop, but Sotio has backed up its ambition with investments in production capacity in Prague and China. As well as supporting the Phase III trial, the capacity is being used for a Phase II ovarian cancer study and planned Phase I/II research into a lung cancer immunotherapy.
Having the capabilities to build and develop a pipeline of clinical-stage immunotherapies sets Sotio apart from many of its neighbors in central and eastern Europe. Local trade group CzechBio has 28 members, including Sotio, but many of these are providers of research products and services. If the Phase III trial is a success, Sotio will enter a market currently dominated by the likes of Johnson & Johnson ($JNJ) and Medivation ($MDVN).
Postlaunch proved to be the undoing of the former poster child of prostate cancer immunotherapies, Dendreon ($DNDN), which having pulled off the coup of bringing Provenge to market has struggled to grow sales and limit production costs. - read the Bloomberg article
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Oxford BioMedica plans £26M fundraising to finance gene therapy development
Weeks after revealing it was looking into ways to raise the cash it needs to keep going beyond the third quarter, Oxford BioMedica (LSE:OXB) has detailed plans to generate £25.7 million ($43 million) by selling shares. Around half of the cash will go toward development of its 7 gene therapy drugs and the identification of new therapeutic candidates.
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| Oxford BioMedica CEO John Dawson |
Investors have already committed £20 million, with Oxford BioMedica hoping to raise a further £5.7 million through an open offer of new shares. While some of the cash will be swallowed by expenses and the repayment of a loan from a major shareholder, the Oxford-based biotech still expects to have £11 million to develop its gene therapy products and a further £1 million for discovery work. If the open offer pulls in the anticipated £5.7 million, this will go toward funding ongoing operations.
The fundraising is intended to bridge the gap between the end of a collaboration with Sanofi ($SNY)--revenue from which was the biotech's main source of cash--and the development of new sources of income. Finding a new partner for RetinoStat, the clinical-stage macular degeneration drug dropped by Sanofi, would be an immediate boost. And Oxford BioMedica is also looking to benefit from renewed interest in gene therapy by expanding its manufacturing services business.
Oxford BioMedica is committing £4 million of its new funds to strengthening its manufacturing capabilities and business, which already lists Novartis ($NVS) as a client. With cash flowing into gene therapy--two biotechs across the channel in France have raised $34 million in the past 6 weeks--the company foresees rising demand for its services. If the plan works the cash should offset the cost of moving its 7 gene therapy drugs--5 of which are for eye disorders--through development. - read the release
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CNS startup becomes first spinout from German incubator
Germany's Life Science Inkubator has delivered its first startup to the world, with Neuway Pharma spinning out from the site that has nurtured it for the past four years with €2.7 million ($3.7 million) in funding. Wellington Partners led the Series A round, which gives Neuway a platform from which it can develop its drug delivery system to treat orphan brain diseases.
The drug delivery platform--which is designed to move molecules across the blood-brain barrier--is the focus of Neuway's business and one of the main attractions for its financiers. Neuway will use the technology as the basis for development of treatments for orphan brain diseases--glioblastoma multiforme is an early target--while also partnering with other companies on central nervous system indications. The team behind Neuway have quietly worked on the platform at Bonn-based Life Science Inkubator for the past four years using €2.3 million in funding from the German government.
Now, with the guidance of European VC shop Wellington Partners, Neuway is ready to try to tap into the platform's commercial potential. "If you find a way to transport any kind of molecules through the blood-brain barrier and into the neurons and other cells of the CNS you may have the key to treat many life-threatening brain diseases much more effectively. This is why we are strongly committed to this project," Wellington Partners' Dr. Rainer Strohmenger said in a statement. Strohmenger has had a hand in many of Wellington Partners' successful biotech investments.
Swiss biotech Actelion ($ATLN) is one of Strohmenger's investments that is still going solo. Strohmenger also backed some startups that have been snapped up by Big Pharma, notably Grandis, Wavelight and mtm laboratories, which were acquired by Novartis ($NVS), Alcon and Roche ($RHHBY), respectively. There is a long way to go before Neuway can be chalked up as another success. The drug delivery platform--which uses viruslike particles to trick the blood-brain barrier--appears to work in mice, but more challenging tests await. - here's the release (PDF) and some background
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Pfizer ($PFE) finally, but perhaps temporarily, dropped its efforts to buy AstraZeneca ($AZN) this week. But for the United Kingdom's life sciences sector, the soul searching the pursuit prompted continues, with the Financial Times raking over the ashes of Pfizer's Sandwich site to show how drug R&D is changing. "Managing at scale became incredibly difficult. The business concept turned out to be flawed," Dr. Declan Doogan, who ran Pfizer's Sandwich site from 2001 to 2003, told the FT. Financial Times
Sweden's Active Biotech ($ACTI) suffered a setback when European regulators confirmed their earlier decision to reject the multiple sclerosis drug it is developing with Teva ($TEVA). Despite the blow, the partners remain committed to the compound, which could help Teva offset the effect of generic competition for its blockbuster MS drug Copaxone. FierceBiotech
Imperial College London received a £40 million ($67 million) donation to create a biomedical innovation center. The cash will allow Imperial to construct a new building at its campus in west London, at which it will bring together engineers and physicians to research biomedical technologies. Imperial will also host spinout companies. The man who made the donation, Michael Uren, talked up the benefits of housing the companies so near to London's financial center. Release
At the end of last month Transgene (EPA:TNG) was hit by the body blow of Novartis' ($NVS) decision to drop out of a partnership, but the French biotech closed out May with better news. Updated Phase IIb data on the immunotherapy Novartis abandoned is in and Transgene views the results as compelling enough to start discussing a late-phase trial with regulators. The hunt for a new partner remains the company's primary objective. Release
A pair of German biotechs reported positive Phase II data. Shares in Paion jumped 15% after a Phase II study of its short-acting anesthetic met its primary endpoint. The company is in the final stages of preparing a European Phase III trial. Ganymed Pharmaceuticals also posted data from a Phase IIa trial of its gastroesophageal cancer candidate. Paion | Ganymed
Days after confirming it is relocating to Cambridge, British service provider PolyTherics struck a deal with Canada's Alpha Cancer Technologies (ACT). PolyTherics will produce drug conjugates for ACT to test. Cambridge | ACT | FierceDrugDelivery
Sweden's Alligator Bioscience bought back an antibody-based immunotherapy from its former partner BioInvent. The biotechs have taken the candidate to the cusp of Phase I, for which BioInvent will handle some activities relating to supplying the drug. Once this work is complete, BioInvent will be free to focus on its in-house pipeline, which includes a Phase II multiple myeloma candidate. Release
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Read previous editions of the EuroBiotech Report here.
