Just five months after former Sanofi SA chief Chris Viehbacher took charge of the $2 billion health care fund Gurnet Point Capital, he's launching a drug development venture dedicated to transforming undeveloped but promising molecules into a portfolio of high-quality, phase III-ready assets.

With $600 million in initial funding, the Cambridge, Mass.-based company, Boston Pharmaceuticals, could put 20 to 25 programs into the clinic and plans, in most cases, to create a special purpose vehicle for each in which asset originators would get equity stakes.

"We'll take the financial and development risk of doing phase I and a really robust proof of concept," Viehbacher told BioWorld Today. The goal is to build a "curated portfolio" of programs in indications with objectively measurable outcomes, he said, creating value by bringing significant talent to bear on the design of proof-of-concept studies and the selection of the molecules. Clinical work will be outsourced.

Viehbacher will serve as chairman of the new company, while Rob Armstrong, former head of external R&D at Eli Lilly and Co.'s Chorus division, will serve as CEO.

The new company will focus primarily on phase I and phase II assets, seeking to "dramatically reduce the risk of attrition in phase III" by running well-designed trials intended to illuminate the value of molecules that other companies may have de-prioritized or been unable to fund.

Though the company's initial areas of focus have yet to be specified, Viehbacher noted his continuing interest in rare disease, as well as in immune diseases and oft-overlooked areas such as women's health. Boston is less likely to go into areas that would require large outcomes studies such as metabolic disease, but it's "hard to generalize," he cautioned, as even within the cardiovascular disease space, there are small unmet areas of need. With Boston's scale of operations, even drugs with potential markets of just $100 million to $200 million a year could become interesting, he said. (See BioWorld Today, Feb. 17, 2011.)

This year, Viehbacher is hiring a core team of about seven industry veterans to support the new company, starting with Armstrong, whose expertise will be crucial, since the new company is adopting a strategy he executed at Chorus: acquiring molecules from both big pharma and biotech companies.

In addition, the company has hired former Pfizer Inc., Bristol-Myers Squibb Co. and Eisai Co Ltd. executive Santiago Arroyo as chief medical officer, and brought on board Constantine Chinoporos, Sanofi's former vice president of global licensing and business development. Chinoporos was vice president of corporate development at Genzyme and the alliance manager for primary care products at Eli Lilly and Co.

By the end of 2016, Boston could have a full complement of 20 to 25 core team members, Viehbacher said. Those experts in licensing, development, regulation and other activities will not only help build out Boston's portfolio, but also will serve as key advisors to Viehbacher as he seeks to deploy Gurnet Point's capital in other areas, which could include medical device development, which he noted typically has a shorter regulatory path that therapeutics.

"There hasn't necessarily been the massive clinical development that, which is not only needed from a regulatory point of view, but when you're up in front of payers and when you're trying to compete becomes quite important," he said. "We can bring some of that clinical and medical expertise that might make some of those technologies more valuable."

With Viehbacher's ambitions and network, and the backing by Gurnet's sole funder, Swiss entrepreneur and Serono inheritor Ernesto Bertarelli, Boston could have an interesting story ahead.

"We're not pursuing liquidity moments in the four- or five-year time frame," said Viehbacher. "If they're there, I'm sure we'll take them. But very often you need to invest between eight and 10 years in some projects to get maximum value appreciation. I think that's where patient capital is helpful."