Last summer, the low-profile biotech Afferent Pharmaceuticals looked like it was prepping a jump into the IPO queue, raising a $55 million C round from a set of crossover investors. The market went into a deep chill, the IPO never materialized and on Thursday the drug developer became the property of Merck ($MRK), which handed over $500 million in cash for the company along with a promise of up to $750 million more if its mid-stage lead drug rings up a commercial win.
Launched in 2009 with backing from Third Rock and Pappas, with Kevin Starr taking the chairman’s role, San Mateo, CA-based Afferent specialized in targeting the P2X3 receptor as a pathway to treating a variety of neurogenic conditions. Hitting this target should damp down a process that oversensitizes certain sensory nerves.
Just weeks ago the company offered updated data from its Phase IIb dose escalation study of its lead drug, AF-219, which showed its ability to significantly reduce persistent coughing, with about half of the patients in the low-dose 50 mg arm demonstrating at least a 50% reduction in coughing.
More data were to come soon, which Merck evidently has seen already. And the biotech had been planning a Phase III launch in 2017.
Afferent was helmed briefly by Plexxikon vet Kathleen Sereda Glaub, who will likely be back in the West Coast biotech CEO pool soon.
Merck doesn’t do many of these biotech bolt-on buyouts, or many deals in general. Since its $9.5 billion Cubist buyout in late 2014, the pharma giant picked up an option on Quartet Medicine back in January, bagging little Edinburgh-based IOmet and its immuno-oncology tech a few days later. A little more than a year ago it paid $200 million to buy into NGM’s research ops in a pipeline-building initiative for the pharma giant.
Merck R&D chief Roger Perlmutter has a long track record on these kinds of relatively small acquisitions that date back to his stint at Amgen ($AMGN). He’s known to play a big role in directing the business development team, ready to step in personally to make a deal happen when he gets excited by the tech involved.
But like a lot of major players, Merck and Perlmutter tend to keep their cards close to the vest, reluctant to give up many financial details behind their deals.
“Afferent has pioneered the clinical development of novel investigational candidates selectively targeting the P2X3 receptor, an exciting area of research,” Perlmutter said in a statement. “We look forward to advancing these innovative molecules for patients with conditions like chronic cough, an area of significant unmet medical need.”
- here's the release
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