Novartis Ups The Ante In Immunotherapy With CoStim Buy
This article was originally published in The Pink Sheet Daily
Executive Summary
The European pharma is increasing its stake in cancer immunotherapy with the acquisition of a start-up biotech that brings over late-stage assets against several targets.
Novartis AG is hoping to become a major player in the race to get a new generation of immunotherapy oncology drugs on the market with its acquisition of recently launched Massachusetts biotech CoStim Pharmaceuticals Inc.
The big pharma announced Feb. 18 that it paid an undisclosed amount for the Cambridge-based cancer immunotherapy company with assets in late-stages. The closely held biotech was founded in 2012 by MPM Capital and led by MPM manager Luke Evnin and Robert Millman. Atlas Ventures joined MPM in early 2013 to fund the company’s $10 million Series A round. Atlas partners Jean-Francois Formela and Josh Resnick joined the board of CoStim as part of that financing. Johnson & Johnson Development Corp. (JJDC) and Partners Innovation Fund also contributed to the Series A.
While terms of the deal were not disclosed, Atlas partner Bruce Booth wrote in a recent blog post that “if the contingent milestones are paid, this deal will return a significant portion of the entire Life Science allocation in Atlas Fund VIII.”
The company was based on the work of Arlene Sharpe of Harvard Medical School and Gordon Freeman of Dana-Farber Cancer Institute, as well as others and relied on the concept that blocking negative environmental signals could be more important in the regulation of T-cell activity than further ramping up the immune cells’ activity.
CoStim adds several late-stage immunotherapy assets to the Novartis pipeline directed at several different targets, including PD-1. Novartis said in a statement that the assets will add to its work in chimeric antigen receptor (CAR) technology.
“Therapy for many types of cancers are expected to increasingly rely on rational combinations of agents,” said Mark Fishman, president of the Novartis Institutes for BioMedical Research, in a statement. “Immunotherapy agents provide additional arrows in our quiver for such combinations.”
Deal-making in the oncology space has been fast-paced over the last few years – there were 23 cancer deals recorded in 2013, down slightly from 27 the year prior (Also see "Oncology Leads Start-Up Biopharma Licensing In 2013" - Scrip, 9 Jan, 2014.).
Immunotherapy Is Hot Hot Hot
The immunotherapy concept has become a strong factor driving research and development in the oncology landscape – particularly among big pharma companies. In particular, this has been driving work at Merck & Co. Inc., Bristol-Myers Squibb Co. and Roche – each of which are placing large bets on immunotherapy drugs that block the PD-1 pathway. Analysts estimate the immunotherapy market eventually could be as large as $35 billion (Also see "Cancer Checkpoint Race Takes Turn With BMS’ New Lung Trial, Merck’s Rolling Melanoma BLA" - Pink Sheet, 27 Jan, 2014.).
There has been plenty of hype surrounding Merck’s program in particular, especially after the New Jersey-based pharma signed three separate collaborations for its drug, MK-3475, in early February (Also see "Pushing Hard On PD-1, Merck Signs Trio Of Combo Development Deals" - Pink Sheet, 5 Feb, 2014.).
The market has been paying particular attention to Novartis’ CART program, which currently consists of three different approaches. Its cornerstone – brought to the company through a deal with the University of Pennsylvania in October 2012 [See Deal] – is CTL019, is a chimeric antigen receptor T cell therapy now in Phase II development in acute lymphoblastic leukemia (ALL) and chronic lymphocytic leukemia (CLL) (Also see "Novartis Puts Combination, Cellular Therapies In Spotlight As It Revamps R&D Portfolio" - Pink Sheet, 2 Dec, 2013.).
The same CART technology potentially could be applied to other tumor types. One is the mesothelin-targeted CART in Phase I for mesothelioma and pancreatic cancer. Another addresses EGFRvIII, a specific target for some glioma patients that is slated to enter the clinic in the first quarter 2014. Both efforts are at very early stages.