Agenus touts blockchain tech to roll out new ‘dig­i­tal se­cu­ri­ty’ for its PD-1, but will it work?

Be­set with set­backs, a once cash-poor Agenus had some­thing to cheer late last year when be­he­moth Gilead signed on as a part­ner on up to five of its im­muno-on­col­o­gy pro­grams. On Tues­day, the biotech of­fered in­vestors an in­trigu­ing pro­pos­al: fund the de­vel­op­ment of a sin­gle drug, while pre­serv­ing share­hold­er eq­ui­ty.

In per­haps the first in­stance of a bio­phar­ma com­pa­ny con­duct­ing such a ‘dig­i­tal se­cu­ri­ty’ of­fer­ing, Agenus said it was launch­ing a to­ken  de­signed to en­able qual­i­fied in­vestors to di­rect­ly in­vest in a sin­gle biotech prod­uct – in this case, the to­kens is­sued will rep­re­sent a por­tion of po­ten­tial fu­ture US sales of AGEN2034, Agenus’ late-stage an­ti-PD-1 an­ti­body.

Biren Amin

“I have nev­er seen this type of arrange­ment. I think there may be lim­i­ta­tions in terms of par­tic­i­pa­tion from in­sti­tu­tion­al in­vestors who may not be able to par­tic­i­pate,” Jef­feries’ Biren Amin, who cov­ers Agenus $AGEN, told End­points News.

The Agenus to­ken is pow­ered by blockchain tech­nol­o­gy, which was was in­vent­ed by an uniden­ti­fied de­vel­op­er in 2008 to pow­er Bit­coin, but is now used across a num­ber of ap­pli­ca­tions. Es­sen­tial­ly, it is a se­quence of blocks or groups of trans­ac­tions that are chained to­geth­er and dis­trib­uted among users, map­ping an un­al­ter­able record of trans­ac­tions that are not de­pen­dent on an ex­ter­nal au­thor­i­ty to val­i­date da­ta.

In­vestors will be el­i­gi­ble to pur­chase the Agenus’ to­kens un­der pre­ferred terms in the ini­tial stage of the of­fer­ing, which is slat­ed for mid-Feb­ru­ary. The Lex­ing­ton, MA-based com­pa­ny ex­pects to raise up to $100 mil­lion to de­vel­op and sell AGEN2034.

“Agenus an­tic­i­pates the in­dus­try will adopt this fi­nanc­ing mod­el as an at­trac­tive means of ob­tain­ing cap­i­tal in com­ing years. BEST (Agenus’ to­ken) is ex­pect­ed to lead to the emer­gence of a new mar­ket­place for as­set-spe­cif­ic se­cu­ri­ties pro­vid­ing in­vestors with unique fund­ing al­ter­na­tives and op­tions for man­ag­ing risk,” the can­cer drug de­vel­op­er said in a state­ment on Tues­day.

Brad Lon­car, chief ex­ec­u­tive of Lon­car In­vest­ments which runs the Lon­car Can­cer Im­munother­a­py ETF, sug­gest­ed a num­ber of peo­ple in the in­dus­try were work­ing on such fund­ing arrange­ments.

Brad Lon­car at the US-Chi­na Bio­phar­ma In­no­va­tion and In­vest­ment Sum­mit in Shang­hai on Oc­to­ber 23, 2018; End­points News, Pharm­Cube

Click on the im­age to see the full-sized ver­sion


“Set­ting aside the specifics of this Agenus PD-1, I do think the con­cept has po­ten­tial. It would al­low com­pa­nies to raise funds for sin­gle as­sets with­in their pipelines and for in­vestors to back in­di­vid­ual projects. It’s a very unique and ap­peal­ing con­cept.”

But the fresh ap­proach to fund­ing comes with fresh ques­tions. For in­stance, gov­er­nance. “These would all be in­di­vid­ual se­cu­ri­ties so how do you en­sure there is ap­pro­pri­ate in­vestor ed­u­ca­tion and trans­paren­cy through­out the drugs’ de­vel­op­ment?,” Lon­car said.

Then there is the ques­tion about liq­uid­i­ty. “These are like­ly to be small projects so it re­mains to be seen if these will be liq­uid as­sets that are priced ef­fi­cient­ly,” Lon­car not­ed, adding that if in­vestors elect to sell to­kens they will pre­sum­ably do so on the sec­ondary mar­ket like any oth­er to­ken.

There are a laun­dry list of oth­er hy­po­thet­i­cals to pon­der: since each to­ken will rep­re­sent a slice of fu­ture US sales of AGEN2034, what hap­pens if the drug is re­ject­ed? In con­trast, if the drug is ap­proved, what im­pact does this strat­e­gy have on any po­ten­tial part­ner­ships Agenus may want to ink in or­der to com­mer­cial­ize?

End­points has con­tact­ed Agenus for com­ment.

Part club, part guide, part land­lord: Arie Bellde­grun is blue­print­ing a string of be­spoke biotech com­plex­es in glob­al boom­towns — start­ing with Boston

The biotech industry is getting a landlord, unlike anything it’s ever known before.

Inspired by his recent experiences scrounging for space in Boston and the Bay Area, master biotech builder, investor, and global dealmaker Arie Belldegrun has organized a new venture to build a new, 250,000 square foot biopharma building in Boston’s Seaport district — home to Vertex and a number of up-and-coming biotech players.

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Novotech CRO Ex­pands Chi­na Team as Biotech De­mand for Clin­i­cal Tri­als In­creas­es up to 79%

An increase in demand of up to 79% for clinical trials in China has prompted Novotech the Asia-Pacific CRO to rapidly expand the China team, appointing expert local clinical executives to their Shanghai and Hong Kong offices. The company is planning to expand their team by 30% over the next quarter.

Novotech China has seen considerable demand recently which is borne out by research from GlobalData:
A global migration of clinical research is occurring from high-income countries to low and middle-income countries with emerging economies. Over the period 2017 to 2018, for example, the number of clinical trial sites opened by biotech companies in Asia-Pacific increased by 35% compared to 8% in the rest of the world, with growth as high as 79% in China.
Novotech CEO Dr John Moller said China offers the largest population in the world, rapid economic growth, and an increasing willingness by government to invest in research and development.
Novotech’s 23 years of experience working in the region means we are the ideal CRO partner for USA biotechs wanting to tap the research expertise and opportunities that China offers.
There are over 22,000 active investigators in Greater China, with about 5,000 investigators with experience on at least 3 studies (source GlobalData).

H1 analy­sis: The high-stakes ta­ble in the biotech deals casi­no is pay­ing out some record-set­ting win­nings

For years the big trend among dealmakers at the major players has been centered on ratcheting down upfront payments in favor of bigger milestones. Better known as biobucks for some. But with the top 15 companies competing for the kind of “transformative” pacts that can whip up some excitement on Wall Street, with some big biotechs like Regeneron now weighing in as well, cash is king at the high stakes table.

We asked Chris Dokomajilar, the head of DealForma, to crunch the numbers for us, looking over the top 20 deals for the past decade and breaking it all down into the top alliances already created in 2019. Gilead has clearly tipped the scales in terms of the coin of the bio-realm, with its record-setting $5 billion upfront to tie up to Galapagos’ entire pipeline.

Dokomajilar notes:

We’re going to need a ‘three comma club’ for the deals with over $1 billion in total upfront cash and equity. The $100 million-plus club is getting crowded at 164 deals in the last decade with new deals being added towards the top of the chart. 2019 already has 14 deals with at least $100 million in upfront cash and equity for a total year-to-date of over $9 billion. That beats last year’s $8 billion and sets a record.

Add upfronts and equity payments and you get $11.5 billion for the year, just shy of last year’s record-setting $11.8 billion.

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UP­DAT­ED: With loom­ing ‘apoc­a­lypse of drug re­sis­tance,’ Mer­ck’s com­bi­na­tion an­tibi­ot­ic scores FDA ap­proval on two fronts

Merck — one of the last large biopharmaceuticals companies in the beleaguered field of antibiotic drug development — on Wednesday said the FDA had sanctioned the approval of its combination antibacterial for the treatment of complicated urinary tract and intra-abdominal infections.

To curb the rise of drug-resistant bacteria and maintain the efficacy of the therapy, Recarbrio (and other antibacterials) — the drug must be used to treat or prevent infections that are proven or strongly suspected to be caused by susceptible gram-negative bacteria, Merck $MRK said.

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John McHutchison in 2012. Getty Images

The $1.1M good­bye: Gilead CSO John McHutchi­son is out as Daniel O’Day shakes up the se­nior team

Just a little more than a year after John McHutchison grabbed a promotion to become CSO at Gilead in the wake of Norbert Bischofberger’s exit, he’s out amid a shakeup of the senior team that is also triggering the departure of two other top execs.

Gilead stated that McHutchison “has decided to step down” from the job as of August 2nd. And their SEC filing notes that he’ll be getting a $1.1 million check to settle up on his contract.

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Thomas Gajewski, David Steinberg. (CRI, Pyxis)

Bay­er, Long­wood back star re­searcher's deep dive in­to the tu­mor mi­croen­vi­ron­ment for new I/O tar­gets

From PD-1 targeting to the RAS pathway to the STING complex, Thomas Gajewski has spent the past two decades of his career decoding the various ways the immune system can be unleashed to defend against cancer. So when the University of Chicago professor comes around to putting all his findings into a new platform for finding new targets, VCs and pharma groups alike pay attention.

“He’s been studying T cells for 20 years, plus he’s one of the world’s leaders if not the world leader in the space,” David Steinberg, partner at Longwood Fund, said. “Furthermore, let me add he did a lot of the foundational research and also some of the seminal clinical trials in the existing set of I/O agents. He understands the space really well, he understands the current strengths, and I think he understood really well what was missing, so he knew where to look.”

Kamala Harris speaking yesterday at the Des Moines Register Iowa Presidential Candidate Forum [via Getty]

Who’s the tough­est on drug prices? A game of po­lit­i­cal one-up­man­ship is dri­ving the pol­i­cy de­bate in Wash­ing­ton

Earlier this week we got a look at Senator Kamala Harris’ position on drug prices. She’s proposing that HHS take an average price from single-payer systems like the UK, Germany and Canada — which leverage market access for lower prices — and use that to set the US price. Anything drug companies collect above that would be taxed at a rate of 100%.

And the rhetoric is scathing:
While families struggle to make it to the end of the month, pharmaceutical companies are turning record profits. They’re spending nearly as much on advertising as R&D. They’re manipulating their market power to hike prices on lifesaving generic drugs. They’re making twice the profit of the average industry in America and still increased drug prices by 10.5% over the past six months alone. Meanwhile, they are charging dramatically higher prices to American consumers.
That’s an escalation on Joe Biden’s plan, which includes drug importation from those cheaper markets as well as allowing Medicare to negotiate prices — something that virtually all Dems agree on now.

SJ Lee [File photo]

Go­ing in­side cells, Sung Joo Lee has sketched some big goals for his small — but glob­al — team of drug hunters

For a small biotech based in South Korea with a research arm in Cambridge, MA, Orum Therapeutics has sketched out some big goals aimed at developing antibodies for intracellular targets. And now they have a new $30 million round to push the work forward, aiming at a slate of currently undruggable quests.

Orum has been working on a platform tech out of Ajou University that relies on endocytosis to smuggle antibodies and their cargo inside a cell. They’ve published work in Nature that illustrates its preclinical potential in RAS mutations, and KRAS is on their list of targets. 

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Astel­las buys in­to Fre­quen­cy's re­gen­er­a­tive med strat­e­gy with a $625M al­liance on hear­ing loss

The executive team at Frequency Therapeutics never oversold the results of their maiden Phase I/II study for a new drug to rectify hearing loss. It was, they said back in April, primarily about safety and tolerability, where their drug FX-322 performed as they had hoped. 

That early glimpse of efficacy everyone searches for in their first try on humans? 

(I)mprovements in hearing function, including audiometry and word scores, were observed in multiple FX-322 treated patients.

We don’t know exactly what that means. But whatever the details, Astellas found enough in the data to jump in with a sizable collaboration deal.

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