Vedere Bio didn’t stand a chance.
The Atlas Venture gene therapy startup was working under the radar and contemplating another venture round when it got an offer it couldn’t refuse: $150 million upfront to become part of Novartis, with another $130 million promised if it hits certain goals.
“Even before we came out of stealth mode, there was a lot of inbound interest through the Atlas network and through my own network,” said Cyrus Mozayeni, M.D., CEO of Vedere Bio and an entrepreneur in residence at Atlas Venture.
Through the buyout, Novartis gets its hands on a group of preclinical gene therapies designed to restore vision.
“We had deep discussions with other parties, but Novartis really stepped away from the pack in terms of their level of interest, not just financially, but in terms of the team they came to the discussion with and the level of sophistication and thought they put into the conversation with us,” he added.
The deal follows Eli Lilly's $135 million buyout of Disarm Therapeutics, a preclinical-stage company working on treatments for amyotrophic lateral sclerosis and other neurodegenerative diseases, and comes as biotechs are going public at increasingly earlier stages.
Vedere's own preclinical programs aim to treat vision loss caused by the death of photoreceptors, or light-sensing cells in the retina, rather than blindness stemming from damage to the brain or optic nerve. And they’re optogenetic, meaning that they work by delivering the genetic code to express a light-sensing protein in the retina.
“When light comes into the eye, it interacts with that light-sensing protein and leads to a neuro-electrical signal through the optic pathway back to the brain, which, hopefully, will recapitulate the sight that has been lost,” Mozayeni said.
The hope is not to just slow down or stop vision loss, but to restore vision, making it possible to treat patients at any stage of their disease.
The optogenetic approach also means the treatments should work regardless of the genetic mutation that underlies a person’s vision loss. Other genetic treatments, such as Roche’s Luxturna or Editas Medicine's clinical-stage EDIT-101, address specific mutations that cause Leber congenital amaurosis, an inherited form of blindness.
Novartis adds its new assets to a pared-down eye medicine business, having spun out its Alcon unit in March last year and shifted focus to a trio of new opportunities in ophthalmology. The first is brolucizumab, a treatment for wet age-related macular degeneration, and the second, coincidentally, is Luxturna, to which it gained ex-U.S. rights in 2018. The third is exploring digital solutions in eye care, with some potential M&A to come.
And that's not all the Swiss pharma is building up. It's been bolstering its gene therapy stable, forking over $8.7 billion in 2018 for AveXis, now known as Novartis Gene Therapies, the company that brought it the spinal muscular atrophy therapy Zolgensma, and inking partnerships this year with Dyno Therapeutics and Sangamo around gene therapy vectors and gene-regulating treatments, respectively.
As for Vedere, it launched quietly just over a year ago with $21 million in series A funding and technology out of the University of California, Berkeley and the University of Pennsylvania. But the acquisition by Novartis isn’t the end of its story. The Vedere team is starting a new chapter with a group of earlier-stage assets it spun out into a new company, Vedere Bio II.
Though it’s technically a new entity, Vedere II will continue working on gene therapies for eye diseases with the same founders, management team and employees as its predecessor. It’s keeping specifics under wraps but will be working on “new and different technology.”
“We want to continue to build the team, and we’re likely to do a significant financing next year,” Mozayeni said. “Probably around that time, we will share more about what we’re doing with Vedere II.”