British biotech is often a disregarded backwater when it comes to the international view of life sciences, but today a host of positive news has shone the spotlight back onto its potential.
Since the disaster that was Circassia, a British biotech that got a record-smashing IPO then plummeted back to the ground, taking the once star investor Neil Woodford’s reputation with it, it seemed as if the jewel in the British crown had dimmed significantly, dragging down the reputation of U.K. science with it.
In the same week Circassia imploded, Brexit happened, doing little to bolster the positive view of British life sciences; sure, venture capital raises have been strong since, but clinical trial sites are down and could be hit further in the future, according to reports out last year (PDF), with Brexit seen as a large contributor.
But now, U.K. medical science is in for a major payday from LifeArc, a British-based medical research charity, which has sold some of the rights to one of the world’s biggest-selling cancer drugs.
Merck isn’t the only one getting the big bucks from its blockbuster, beat 'em all checkpoint inhibitor Keytruda (which is set to make $16 billion by the middle of next decade), nor was it solely responsible for its creation.
Back in 2007, the research charity penned a collaboration with Organon (bought by Merck in 2009) to humanize the antibody-based therapy; now, it’s sold some of those royalty rights over to the Canada Pension Plan Investment Board (CPPIB), getting about £1 billion ($1.3 billion) in the process.
This cashing-in sees LifeArc instantly become one of the U.K.’s leading medical research charities (by size of its investment assets), which it says allows it to “significantly expand its mission of advancing research that has direct benefits for human health” as well as invest in its own internal programs.
Dr. Melanie Lee, CEO of LifeArc, explained: “At LifeArc, we advance promising research into new health interventions for patients and the public benefit. This agreement with CPPIB allows us to increase our support for new approaches and collaborations and bolster access to our expertise and resources. Ultimately, we can support life sciences research and accelerate the development of new therapies, diagnostics and devices for those people in greatest need.”
LifeArc rose out of MRC Technology, the commercialization arm of the government’s Medical Research Council. Three years ago, it sold a smaller proportion of its Keytruda royalty interest for around $150 million, which was funneled into a private equity fund.
Out of this came two funds: Worth £30 million, the LifeArc Philanthropic Fund provides grants for translational research in rare diseases, and the LifeArc Seed Fund invests in nascent or early-stage spinout companies.
Some of the £1 billion will now be added to these funds, boosting early-stage research in the U.K., with more money available from royalties expected to come from Keytruda in the future. It also has royalty rights to other drugs it helped develop, including Biogen’s multiple sclerosis med Tysabri, rheumatoid arthritis drug Actemra from Roche and gastrointestinal therapy Entyvio, sold by Takeda.
Alongside this windfall, two British startups also gained financial boosts today. New cell therapy startup Quell Therapeutics announced its £35 million series A, and Storm Therapeutics—which is modulating RNA-modifying enzymes—announced it has raised an additional £14 million, bringing its total series A financing to £30 million.
Early-stage Quell gets most of its funding from British investment house Syncona, which has stumped up £34 million, with a further £1 million coming out of the UCL Technology Fund.
The biotech comes to life with the aim of developing engineered regulatory T cell therapies for a range of conditions, including solid organ transplant rejection along with autoimmune and inflammatory diseases.
Elisa Petris, partner at Syncona Investment Management Limited, said: “The foundation of Quell represents an exciting opportunity for Syncona to build the leading cell engineering company with the potential to develop a first-in-class therapy in an innovative field. Over the last year, we have worked to bring together a group of world-class leaders in their respective fields, developed a strategy for the business and funded the business to enable it to scale and succeed.
“We look forward to continuing to work in close partnership with them as we build out the company’s management team and business plan to deliver their goal of becoming the leader in treating conditions of immune dysfunction utilizing gene-modified cells.”
Storm, meanwhile, gets that £14 million bump from a new investor, Seroba Life Sciences, alongside its original investors Cambridge Innovation Capital, M Ventures, Pfizer Ventures, Taiho Ventures and IP Group.
The cash boost will allow Storm to broaden its pipeline further in preclinical development and “accelerate its programs towards the clinic,” specifically on RNA modulating enzymes.It’s also hired Dr. Mark Albertella as its vice president of translational oncology. Albertella comes from Medivir, with a previous stint at AstraZeneca.