Billionaire Soon-Shiong dives into immuno-oncology with $20M Sorrento venture

Patrick Soon-Shiong

Patrick Soon-Shiong, billionaire physician and biotech entrepreneur, wants in on the hottest field in oncology, forming a joint venture with Sorrento Therapeutics ($SRNE) to develop therapies that harness the body's immune system to fight cancer.

Through his NantWorks family of startups, Soon-Shiong and Sorrento are launching an independent venture with $20 million in joint funding and a plan to develop antibody-based immunotherapies. In tandem with the deal, Soon-Shiong's group is acquiring a 19.9% stake in Sorrento, trading about $41.7 million for 7.2 million shares and getting a three-year warrant to buy 1.7 million more shares at $5.80 apiece if it so chooses.

The joint venture will take an all-encompassing approach to immuno-oncology, using Sorrento's antibody technology to develop candidates that block the PD-1, PD-L1 and CTLA4 pathways to name just three, the companies said. Both parties remain light on details--for instance, a name--but each affirms that the venture will benefit from coupling Sorrento's experience crafting antibodies and antibody-drug conjugates with NantWorks' years of using Big Data to better understand cancer treatment.

The potential benefits, however, are quite clear. Immunotherapies thus far developed by the likes of Merck ($MRK), Bristol-Myers Squibb ($BMY) and Roche ($RHHBY) have charted outstanding clinical results in cancers with particularly grim prognoses, promising to change the standard of care in diseases like melanoma and non-small cell lung cancer. Analysts expect such treatments to create a multibillion-dollar market in the process.

Sorrento and NantWorks, appearing to start from scratch in the field, are unlikely to compete with the first movers in immuno-oncology, but the partners figure their complementary approaches will help forge next-generation therapies that carve out a space in what could be the biggest ever class of blockbuster drugs.

"Combining NantWorks' cutting edge expertise in genomic and molecular profiling of cancer patients and Sorrento's industry-leading G-MAB antibody technology, we believe will enable us to develop multiple novel therapies for malignant disorders where there is currently a significant unmet need," Soon-Shiong said in a statement. "Through this partnership, it is our goal to provide relief for millions of people who today have limited treatment options. This will be a model relationship aligned to accelerate development and production of novel cancer immunotherapies."

And investors are fond of the collaboration, sending Sorrento's shares up about 25% on the news Monday.

For Soon-Shiong, the venture is the latest gambit in his expansive approach to oncology, which includes an embrace of Big Data, a slew of biotech deals and a fair amount of bluster--his Twitter handle is @solvehealthcare. Back in 2010, Celgene ($CELG) bought Soon-Shiong's Abraxis BioScience for $2.9 billion, and he's maintained a close relationship with the company ever since, partnering up on the cloud-based oncology brain trust NantHealth and the more straightforward drug developer NantBioScience.

Soon-Shiong has launched NantOmics, a molecular diagnostics venture with technology that uses genomic and proteomic analyses to profile tumors. The billionaire's overarching goal is to unite cloud computing, genomic analysis and targeted drug development to create an end-to-end oncology system that can eventually manage a patient's cancer much like the industry current handles chronic disease.

- read the announcement
- here's Sorrento's SEC filing

Special Report: Fierce's 10 top biotech billionaires - Patrick Soon-Shiong

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