Roche has paid out $250 million cash to acquire Good Therapeutics as part of a bid to bolster its immuno-oncology efforts with the Seattle biotech's preclinical PD-1-regulated IL-2 program.
The Swiss pharma giant will be fully responsible for the global development and commercialization of a PD1-regulated IL-2 receptor agonist program, while the rest of Good Therapeutics’ assets will be shifted over to a new spinout dubbed Bonum Therapeutics.
“Good Therapeutics showed that the concept and technology—the idea of a shape-shifting protein that changes its activity in response to a signal—works,” John Mulligan, Ph.D., founder and CEO of Good Therapeutics, told Fierce Biotech. The company proved its tech’s worth once and will do it again, according to Mulligan, this time with preliminary work for half a dozen programs already in hand.
Under the merger—which is set to close in the third quarter of this year—Good Therapeutics will also be eligible for development, regulatory and commercial milestone payments from Roche. The Big Pharma didn’t disclose further financial details, though Roche’s head of oncology and pharma partnering Patrick Schleck said the overall deal package is “in line with comparable transactions and reflects both the early nature of the program and its future high potential.”
Conditionally active therapeutics are a new class of investigational drugs designed to offer potent activity only where it is needed. Good’s context-dependent molecules combine an antibody sensor directed against a specific marker and a therapeutic component that activates only when the sensor has bound to its target. The therapeutic component can be regulated by any molecule that an antibody can bind to, and the shape of the molecule is determined by the antibody bonding.
The PD-1-regulated IL-2 program now under Roche’s umbrella is designed to deliver potent IL-2 stimulation of T cells without the toxicity that can limit unregulated IL-2 therapeutics. Roche's Schleck said the preclinical program demonstrated excellent in vitro and in vivo data. Though he couldn’t reveal specific clinical timeline goals, the executive said Roche believes PD1-regulated IL-2 could become the new backbone for checkpoint-inhibitor-based therapies and help target broader patient populations.
Founded in 2016, Good Therapeutics was based on two main ideas: to make drugs that regulate their own activity and to sell programs—not platforms, the biotech's CEO explained. The Roche deal validates both of those ideas, Mulligan said.
“We’re super excited about having Roche take this program,” he said.
When asked whether the prolonged bear market—which has prompted a gaggle of biotechs to cull pipeline programs and staff alike—played a part in the deal, Mulligan said the acquisition was a long time coming and negotiations had started before the downturn. However, he acknowledged that the market conditions had some impact, as it has on everyone in the industry.
After the deal closes, the biotech's 26 employees will all move to the newly created Bonum Therapeutics, where Mulligan will continue to lead as CEO. The team will be focused on using the platform to design conditionally active therapeutics that address other targets in cancer outside of PD-1-regulated IL-2 as well as autoimmune diseases, metabolic disease and pain management.
Roche is already a major player in the checkpoint inhibitor space thanks to the blockbuster PD-L1 drug Tecentriq. The company also has history with Good Therapeutics, as the Big Pharma's venture fund has been an investor, alongside the likes of Codon Capital, RiverVest Venture Partners, 3x5 Partners and Digitalis Ventures. All of these backers are on board for Bonum, according to Mulligan.
Good Therapeutics had a bridge financing in August that will carry it through the next few months and is in discussions about an upcoming series A financing round, he added.
The new biotech will also be looking for potential partners.
“We’re not going to take every program we can do into the clinic or further,” the CEO said. “We’re also interested in discussions with partners who could bring in some other piece of biology in their interest area—like autoimmunity or metabolic disease—where this mechanism can be applied.”
“The sky’s the limit,” Mulligan concluded. “You can bind almost anything with antibodies.”