Denali acquires F-star's blood-brain barrier bispecific antibody tech in deal worth up to $471M

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Bispecific antibodies do more than target two antigens—they are designed to do so in a way that improves upon an approach that simply combines two monospecific antibodies. (rawpixel)

Denali Therapeutics and F-star teamed up in 2016 on bispecific antibodies to deliver drugs across the blood-brain barrier. Now, Denali is pulling the trigger on an option to acquire the latter's F-star Gamma unit in a deal potentially worth $471 million, picking up the rights to antibodies developed under their collaboration. 

The neurodegenerative disease biotech will hand over $24 million up front, the company said in a statement. F-star stands to earn an additional $447 million in milestone payments. It plans to use the proceeds from this deal to bankroll its pipeline of immuno-oncology bispecific antibodies. While it hasn't disclosed specific indications, it has a range of programs "in various stages of preclinical development," said CEO John Haurum. One candidate, targeting a pair of checkpoint molecules, LAG-3 and PD-L1, recently entered phase 1. 

F-star's Modular Antibody Technology makes bispecific antibodies by introducing a new antigen binding site to the constant (Fc) region of an antibody. This binding site, dubbed an Fcab (Fc domain with antigen binding ability), in addition to the antibody's own binding domain, allows it to bind to two different antigens. 

"The way we approach it from a drug-hunting point of view is looking for compounds where a bispecific modality provides more than just A plus B," Haurum said. "It's not a matter of putting activity A together with activity B—it's a matter of finding bispecific compounds with a synergy between the two and improving upon what you can achieve with combining two monospecific ones." 

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Under the original agreement, Denali would use F-star's tech to create Fcabs that can bind to transporters in the blood-brain barrier (BBB). It had the option to acquire F-star Gamma before the initiation of the first phase 1 clinical trial of an Fcab developed under the collaboration, but has chosen to ramp up the timeline.

"Our decision to exercise the option to buy F-star Gamma reflects the progress in our collaboration with F-star and the generation of preclinical data showing that our proprietary TV platform technology may enable us to deliver biologics across the BBB and into the brain. Specifically, recent data demonstrated robust and sustained peripheral and brain activity for our ETV:IDS program for Hunter Syndrome and hence preclinical proof of concept. Furthermore, the expanded collaboration allows us to deepen and broaden our research efforts supporting our TV platform technology,” said Denali CEO Ryan Watts, Ph.D., in a statement

Haurum did not disclose Fcab targets beyond the one already made public—a program focused on transferrin receptors as a target on the blood-brain barrier. Transferrin is a protein in the blood that binds to iron to transport it.

In January, Denali scored $150 million up front from Takeda to work on and sell up to three candidates for neurodegenerative diseases based on its Antibody Transport vehicle platform and Fcabs discovered under the F-star collab. The Bay Area biotech pulled off 2017's biggest IPO, raising $250 million to push drugs being developed for Parkinson's and Alzheimer's diseases through early clinical trials.