Staff Writer
Celgene Corp. and privately held Agios Pharmaceuticals Inc. have entered a preclinical collaboration in the area of cancer metabolism, a deal that will bring in a hefty $130 million up front for Agios, including an equity investment.
In return, Summit, N.J.-based Celgene has an exclusive option to license any clinical candidates resulting from the Agios cancer metabolism research platform at the end of Phase I. Once the exclusive collaboration period is up, Celgene may extend the deal through additional funding.
Cambridge, Mass.-based Agios also could receive up to $120 million in milestones as well as royalties on sales, and also may participate in the development and commercialization of certain products in the U.S. Agios will lead discovery and early translational development for all cancer metabolism programs, and Celgene will lead and fund global development and commercialization of licensed programs.
Agios CEO David Schenkein said that the deal structure, which is both front- and back-loaded with cash, is unprecedented for a small company in a start-up position. He also remarked that the deal preserves Agios independence even if Celgene opts to take an Agios program to commercialization.
While other established drug firms have begun to turn their attention to cancer metabolism or have rebranded to focus on the field, Agios, which has a large research lab devoted to cancer metabolism, believes it is a leader in the space. Its founders are among the leading scientists in the cancer metabolism field.
Due to the growing interest in cancer metabolism, there were "a lot of companies vying for our interest," Schenkein told BioWorld Today. Celgene won out for quite a few reasons, he said, citing the quality of the scientific staff, Celgene's marketed medicines for hematological malignancies, and the company's global presence.
In addition, he said Celgene was willing to maintain Agios' independence and showed its level of commitment to cancer metabolism with significant financial backing.
With the infusion of capital from Celgene, Agios is now able to focus on a much broader set of programs. The up-front money that Agios received will allow the firm to "explore many, many more targets" than it could with a conventional deal or a Series B financing round, said Schenkein, who became Agios CEO last year. He previously led medical and scientific strategies for the BioOncology portfolio at Genentech Inc.
The up-front money is "enough funds for us to bring molecules into the clinic," Schenkein said. Although Agios has several programs in the preclinical stage, the goal is to put at least two programs in the clinic.
The company raised $33 million in a Series A financing in 2008 to establish its product and biology platform focused on cancer metabolism, a field of study that looks at how cancer cells become "addicted" to using more nutrients than normal cells to fuel cell survival and growth, according Agios. (See BioWorld Today, July 8, 2008.)
The area of cancer metabolism has been around for decades but has been more fully understood only in recent years. Agios was founded around the growing understanding of how cancer cells reprogram key metabolic enzymes.
The company is working to identify metabolic enzymes that cancer cells have reprogrammed and find small molecules or antibodies to go after those targets. The result could be "an entirely new set of targets for oncology that may represent the Achilles heel of cancer cells," Schenkein said.
Thomas Daniel, president of research for Celgene, said in a statement that the company sees "exceptional value in new targets Agios is uniquely positioned to prosecute."
Three of the company's founders, Lewis C. Cantley, Tak W. Mak and Craig B. Thompson, have made significant contributions in the area of cancer biology research. Shin-San Michael Su, also one of the founders of Agios, is the former program executive and vice president of the Novartis AG kinase collaboration for Vertex Pharmaceuticals Inc. He currently serves as vice president of drug discovery and interim chief scientific officer at Agios.
Cantley, professor of systems biology at Harvard Medical School and director of the cancer center at Beth Israel Deaconess Medical Center, is considered a world leader in the understanding of the biochemical pathways linking cancer and energy metabolism, and is credited with discovering the phosphatidylinositol-3-kinase signaling pathway.
Mak, professor of medical biophysics at the University of Toronto and director of the Advanced Medical Discovery Institute, is a preeminent researcher of the biology of the immune system, the biology of apoptosis and the pathogenesis of cancer. His key contributions include discovering the T-cell receptor.
Thompson, director of the Abramson Cancer Center and chair of the department of cancer biology at the University of Pennsylvania, is an authority in the study of how genes regulate apoptosis and metabolism and investigates their application in treating cancer.
Shares in Celgene (NASDAQ:CELG) were up 33 cents, closing at $60.62.