Deals, Startups

An upstart in the polyclonal antibody biz just lined up $50M for its plan to disrupt a multibillion-dollar business

The multibillion-dollar business for immunoglobin products is dominated by three key players: CSL, Shire and Grifols.  And one of them recently invested $50 million in a South San Francisco-based biotech that thinks it has a key to disrupting the entire global market.

The company is a little known private player called GigaGen. It has all of 10 staffers who are now so closely packed into their work space that the company will have to find new digs to expand into. But it has global ambitions to do something completely new in polyclonal antibodies.

The big immunoglobin business centers on products like IVIG, the intravenous infection fighter that extracts a swarm of polyclonal antibodies from donor-derived plasma — distinct from the monoclonal antibody business that has inspired a whole generation of new therapies. GigaGen has been spending the last few years working with about a million dollars in grant money, and a once-off project from Novartis, on its recombinant polyclonal work.

The goal is as simple as it is big: industrialize polyclonal antibodies, taking samples from the best donors and then making them more potent from lower doses, and creating a new supply by making them over and over and over again.

“I invented the technology in 2011,” says GigaGen CEO David Johnson, crediting his alliance with Stanford Associate Professor Everett Meyer — an expert in T cell immunology — on the work.

Grifols is intrigued. The Spanish company paid $35 million in early July to gain a 44% stake in the company, adding $15 million for a licensing fee on the tech. That gains them rights on all the work that GigaGen is doing on polyclonal antibodies.

Originally, Johnson — a former COO at Natera — says he went to a lineup of VCs to see about organizing a syndicate for the company, but they really didn’t get it. Most are completely focused on monoclonals. Start talking to most people about polyclonals, says Johnson, and they assume it’s a small, marginal business.

“It’s not small,” Johnson patiently explained to me (a complete novice on polyclonals). “It’s a huge opportunity. $10 billion. Big markets.”

It was the VCs that suggested he take the story to the three big players in the industry — and that is what worked the charm.

The game plan now is to continue the preclinical work until it’s ready for human testing, not an easy proposition. In the meantime, Johnson’s team has been busily working on PD-1 and a slate of checkpoint inhibitors, figuring that he can line up some new candidates as the players in that hectic monoclonal antibody business compete in fielding new products. And they’re spinning out some T cell work into a new company as well.

That’s a lot for a small company with 10 staffers. A year from now, says Johnson, he expects the team to grow to 15 to 20, with a new facility to work out of. With Grifols partnering on the research, he has some substantial funds to work with. And in the meantime he can consider his chances on an IPO or some other way to raise cash, along with potential partnerships.

GigaGen is a small company that just took a big step. And it’s aiming at a big target.


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