|Celgene SVP of Business Development George Golumbeski|
Close to a year after Forma Therapeutics' executive team hammered out a partnership with Celgene ($CELG) packed with $200 million in early-stage payouts, the big biotech outfit has come back with a $600 million discovery deal that might eventually lead the pair to the M&A altar.
Initially, Celgene R&D chief Tom Daniel and his impresario of the deal table, George Golumbeski, took out the company checkbook to get Forma's big drug discovery engine--now manned by about 110 staffers--focused on protein homeostasis, a hot new field in drug research which explores how a dysfunction in the way a cell properly regulates proteins can trigger disease. Protein misfolding, for example, is a big focus of this field.
In this new deal, which is independent of the first partnership they signed, Watertown, MA-based Forma CEO Steven Tregay has hammered out a pact that delivers a $225 million upfront payment for a 3.5-year drug discovery collaboration covering a broad range of protein target families and therapeutic areas. If that big step works out, there are two more collaborations that can follow that will each run two years, backed by a total of $375 million in milestones. About 7 years down the line, Tregay tells FierceBiotech, if the deal makes it to its third and final step, Celgene will have an option to buy the company at a price to be negotiated based on the value of the company at that time.
|Forma Therapeutics CEO Steven Tregay|
Tregay, who has executed a long string of biopharma partnership deals to fund the development of Forma's considerable drug discovery engine, gets a big partner with pockets deep enough to fund the company for the long haul as it stays in charge of its destiny. And Celgene does what it's good at, too: using its considerable cash reserves to execute long-term partnerships with an outside group that gives it the inside track on new technologies. They're including a buyout option--a favorite tactic of Golumbeski's--to bring it all home if the pact rings all the desired bells of success.
The deal gives Celgene rights to in-license current and future programs, taking over global development responsibilities after Phase I. And Forma--relying on a medicinal chemistry team charged with fine-tuning the best therapies to emerge from its library of candidates--retains U.S. rights to the licensed therapies that spring from its work.
"We no longer have to live from deal to deal," says Tregay, who's now planning on building up more pacts like the one with Cancer Research UK, which linked Forma with the U.K. group's extensive network of scientists.
This big second act to their partnership was spurred by Celgene, Tregay adds. "Celgene has been really keen, where they can, to double down and go deep."
As far as Forma is concerned, it doesn't get much deeper than this. Forma was named a Fierce 15 company in 2011.
"This expansive collaboration will allow FORMA's powerful drug discovery engine to probe multiple emerging areas of biology in the pursuit of step-ahead therapies for future patients," said Golumbeski in a statement. "Both organizations take pride in developing creative alliances that fully enable the science to succeed, and this initiative is truly reflective of that concept."
Special Reports: 2014's most influential people in biopharma today - George Golumbeski | 2011 Fierce 15 - Forma Therapeutics