For its next trick, Moderna splits in two with $20M cancer venture

Messenger RNA pioneer Moderna Therapeutics has been piling up cash since stepping into the light about a year ago, leading to a fair amount of speculation as to just what the biotech planned to do with its more than $500 million war chest. And now the Cambridge, MA, company has chosen the big stage of the J.P. Morgan conference to unveil its next gambit: splitting in two and launching a standalone venture to advance its oncology programs.

Moderna is putting up $20 million to stake Onkaido Therapeutics, a new venture armed with 15 of the biotech's preclinical cancer candidates and plans for apoptosis, central regulatory nodes and immunotherapy. Moderna figures dividing up its assets is the fastest path to success, CEO Stéphane Bancel said, and the biotech will be hard at work industrializing its mRNA platform while Onkaido focuses on cancer.

From here on out, Moderna Senior Vice President Stephen Hoge will pull double duty as Onkaido's CEO, and Millennium Pharmaceuticals veteran Peter Smith will come aboard as the company's founding chief scientific officer.

"Basic research in the past decade has uncovered innumerable targets in cancer, but our ability to reach them therapeutically remains limited," Hoge said in a statement. "We are thrilled and humbled by the opportunity to use this new modality to do things that have never been done before in the fight against cancer."

That new modality has helped Moderna turn some heads since coming out of stealth mode in late 2012. The company's flagship technology has the potential to spur the production of human proteins or antibodies within patient cells, effectively creating an in vivo factory for targeted therapies. The platform's promise has helped Moderna haul in about $150 million in venture cash and up to $545 million down the line through partnerships with AstraZeneca ($AZN) and Alexion Pharmaceuticals ($ALXN).

Of course, Moderna has yet to get any of its candidates into the clinic, making its spinout move more than a little uncommon. But Bancel is steadfast in his belief that the technology's "vast potential" can only be tapped through tandem development.

"We will benefit by enabling Stephen, Peter and the scientific team to focus intensely on the best, most rapid path toward turning our discoveries into cancer therapies that make a difference for patients," Bancel said in a statement.

Moderna, a 2013 Fierce 15 winner, got its start with the help of Flagship Ventures, vaulting off a $40 million seed round to become a well-funded and fast-growing company in short order. Like a great many biotech outfits, Moderna considered an IPO last year but chose to stay private, Bancel said.

- read the announcement

Special Report: FierceBiotech's 2013 Fierce 15 - Moderna Therapeutics