Close on the heels of a new discovery deal this week with Roche ($RHHBY), Versant Venture's incubation team at Inception Sciences outlined plans this week to establish a new research team in Montreal's biotech hub, adding a third site to Inception that will hunt down new pacts and create new biotechs for product-hungry pharma companies.
The Montreal operation is being set up as Inception hubs in San Diego and Vancouver are pursuing their own programs and portfolio companies, says Clare Ozawa, Inception's founding business chief, who's been working on the build-to-buy deals and has now been promoted to COO of the organization. In part, she says, the location selections have followed Peppi Prasit's extensive contacts in the drug research world--which reach deep into Canada.
"For more than 15 years, I had the opportunity to work alongside Merck Frosst scientists in Montreal and appreciate the strong capabilities that exist here," Prasit, the co-founder and CEO of Inception noted. "After co-founding Amira Pharmaceuticals (later sold to Bristol-Myers Squibb), our team became the core of Inception Sciences in San Diego, California."
It also makes sense to hire R&D talent in some relatively low-cost centers far away from the madding crowds in Boston/Cambridge and San Francisco.
"Canada is an area, relative to the Bay Area or Boston, which has been overlooked," says Ozawa. "There are very good academic institutions in Canada we would love to develop relationships with."
"We are a small and nimble company," she adds, "but we are not a virtual company. We do all our discovery work in-house. It's important we keep the sites small enough to maintain that startup feel."
The newly established Vancouver operation is still expanding, with plans to add new hires this year, says Ozawa. Montreal will initially add 15 to 20 investigators to Inception, which stands at about 50 right now with plans to swell to a total of roughly 75 early next year. Another Versant incubator, Blueline, operates in Toronto. That growth has followed its success in building closer ties with pharma companies which are increasingly attracted to these relatively low-cost deals, in which Inception sets out to gather proof-of-concept data on new therapies that can then be optioned to waiting partners.
"I think as Inception has grown and developed, we've been gaining more and more momentum with pharma companies looking to externalize in core or emerging areas," says Ozawa. Other venture groups are also pursuing this model, including Avalon in San Diego and Atlas in Boston.
Inception's model was clearly illustrated earlier this week when Roche and Prasit's group outlined plans to create a virtual biotech which will set out to spawn new therapies that can repair the damaged nerves of patients with multiple sclerosis. Roche will fund the work done by the virtual team at Inception 5, with Versant bankrolling the equity investments needed and Roche paying the research tab. Any small molecules that promise to spur remyelination--protecting the damaged nerve sheaths associated with MS--can be snapped up by Roche under an option arrangement.
- here's the release