Bayer expands discovery deal with PPD spinout X-Chem

DNA

Bayer has been testing out its relationship with X-Chem since 2012. Now, after already having licensed two programs from it, the pharma has upped the ante with a bigger discovery deal.

The new deal extends Bayer access to X-Chem’s DEX technology that’s based on DNA-encoded libraries of small molecules.  It includes an undisclosed upfront payment and R&D funding, in addition to up to $528 million in preclinical, clinical and regulatory milestone payments.

"We have identified the DEX platform as a highly valuable extension for our drug discovery efforts. We are looking forward to working with X-Chem on some of our highest-priority targets," said Andreas Busch, who is a member of the executive committee of Bayer's Pharmaceuticals Division and Head of Drug Discovery, in a statement.

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The two programs that Bayer has already licensed from X-Chem are for a series of small molecules targeting complex structures such as protein/protein interactions. Its drug discovery is based on a library generated via iterative combinatorial synthesis of small molecules tethered to DNA tags that record each molecule’s synthetic history.

X-Chem was owned by contract research organization Pharmaceutical Product Development (PPD), which spun it back out as an independent company early this year. It was founded in 2009 by management from micro-cap Praecis Pharmaceuticals, which sold to GlaxoSmithKline ($GSK) for $55 million in 2007. In 2010, X-Chem partnered with PPD in a deal that included a purchase option, which PPD exercised in the fall of 2014 to buy the entire company.

It also has deals with several other biopharmas including Roche ($ROG), AstraZeneca ($AZN), Pfizer ($PFE), Sanofi ($SNY), Janssen ($JNJ) and Alexion ($ALXN).

"X-Chem is making significant inroads toward the discovery of small molecule drug candidates using its ultra-large screening library,” said X-Chem CEO Rick Wagner. “With multiple successes across our partnerships, the DEX platform has been broadly validated to deliver novel chemical entities against a wide array of targets, including difficult targets."

- here is the release

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