Arie Bellde­grun rais­es $300M, grabs Pfiz­er’s al­lo­gene­ic CAR-T port­fo­lio and launch­es a ground­break­ing dri­ve to com­mer­cial­iza­tion

Af­ter pi­o­neer­ing one of the first per­son­al­ized CAR-T ther­a­pies to be ap­proved by the FDA, Kite vets Arie Bellde­grun and re­search chief David Chang have now launched a new biotech with a whop­ping $300 mil­lion in cash fi­nanc­ing and a col­lab­o­ra­tion with Cel­lec­tis af­ter bag­ging the full port­fo­lio of off-the-shelf CAR-T drugs in de­vel­op­ment at Pfiz­er.

Bellde­grun — who came away with a for­tune of more than $600 mil­lion from the sale of the biotech to Gilead — tells me he gained swift back­ing from a broad syn­di­cate to cre­ate Al­lo­gene Ther­a­peu­tics. And they’re jump­ing out of stage left with a deal that gives them con­trol of Pfiz­er’s CAR-T port­fo­lio, which in­cludes rights to the ear­ly-stage UCART19 al­lied with Paris-backed Cel­lec­tis.

In ex­change, Pfiz­er is get­ting a 25% stake in Al­lo­gene, which im­me­di­ate­ly vaults from out of nowhere in­to a lead­ing po­si­tion among de­vel­op­ers of off-the-shelf CAR-T ther­a­pies, look­ing to leapfrog the first gen­er­a­tion of per­son­al­ized CAR-Ts that use reengi­neered pa­tient cells.

“We have every one of the in­ter­est­ing tar­gets that I’m aware of,” says Bellde­grun, the new­ly mint­ed ex­ec­u­tive chair­man at Al­lo­gene, with Chang tak­ing the CEO job. And they’re ready to get to work with Cel­lec­tis, Servi­er and every­one else en­gaged in the “Man­hat­tan project” of bring­ing the first al­lo­gene­ic CAR-T to mar­ket.

“This is the biggest project,” Bellde­grun says. “This is where cel­lu­lar ther­a­py will find its way.”

David Chang

Bellde­grun and Chang told me in a pre­view of the an­nounce­ment Mon­day evening that the deal be­gan to come to­geth­er the night they were cel­e­brat­ing the close of the Kite sale, when one of the bankers in­volved told them about a po­ten­tial deal he knew of.

In­stead of a leisure­ly va­ca­tion break, what fol­lowed was 5 months of in­tense ne­go­ti­a­tions, in which Bellde­grun got a close, up­front look at the 16 tar­gets that a team of 70 Pfiz­er in­ves­ti­ga­tors have been work­ing on for the past 4 years, along with UCART19, the 17th pro­gram in the deal.

“I looked at the da­ta and said ‘David, we need to do this, it’s a gold mine.’ It’s a deal I couldn’t refuse,” says Bellde­grun. “We know it’s the fu­ture.”

In­stead of a lengthy and ex­pen­sive per­son­al­ized au­tol­o­gous ap­proach that re­quires the ex­trac­tion and reengi­neer­ing of pa­tient cells in­to a po­tent ther­a­py that has proved par­tic­u­lar­ly ef­fec­tive in blood can­cers, Bellde­grun will now look to per­fect a gene edit­ing process that can de­vel­op 50 to 100 ther­a­peu­tic batch­es from a sin­gle donor. If it works, it will be cheap­er and faster than the first CAR-Ts, Yescar­ta and Kym­ri­ah.

This was a deal that in­volved “mul­ti­ple” bid­ders, says Bellde­grun, will­ing to pay a sig­nif­i­cant amount to buy in. But he says he and Chang were able to put to­geth­er the win­ning of­fer by keep­ing Pfiz­er close­ly en­gaged in the start­up and a clin­i­cal dri­ve that could get them to the thresh­old of com­mer­cial­iza­tion in just a few years.

With back­ers deeply im­pressed by their $12 bil­lion sale of Kite to Gilead, Bellde­grun and Chang are work­ing with in­vest­ments from TPG, Vi­da Ven­tures, Bell­Co Cap­i­tal, the Uni­ver­si­ty of Cal­i­for­nia Of­fice of the Chief In­vest­ment Of­fi­cer and Pfiz­er.

The pair of en­tre­pre­neurs are get­ting a team of about 50 Pfiz­er in­ves­ti­ga­tors to trans­fer over in the deal, tak­ing over Pfiz­er space for now in South San Fran­cis­co as they scout their own new digs. And Bellde­grun says they have al­ready lined up a string of “top notch” play­ers to join the com­pa­ny. 

You can ex­pect the pay­roll to dou­ble in the next year, he adds.

An­dré Chouli­ka

The deal teams Bellde­grun and Chang with Cel­lec­tis CEO An­dré Chouli­ka, the French biotech ex­ec who’s been steer­ing the first off-the-shelf CAR-T in­to hu­man stud­ies. Servi­er and Pfiz­er launched a land­mark tri­al of Cel­lec­tis’ UCART19 for acute lym­phoblas­tic leukemia, get­ting the green light to ex­pand from the UK in­to US sites a year ago.

I ran in­to Chouli­ka at an an­a­lysts meet­ing Bellde­grun or­ga­nized for Kite in New York a cou­ple of years ago. It struck me as odd see­ing the al­lo­gene­ic leader at the ri­val au­tol­o­gous gath­er­ing, but Chouli­ka tells me it was part of a long re­la­tion­ship that has con­verged in­to this new deal.

“Arie and my­self have been talk­ing for a long time,” Chouli­ka told me. The mu­tu­al re­spect they de­vel­oped, he says, com­bined with Kite’s ster­ling rep for ex­e­cu­tion, helped bring it all to­geth­er.

“I was con­vinced that Kite would be the win­ner in the au­tol­o­gous space,” says Chouli­ka. And he thinks the new team at Al­lo­gene, com­bined with Cel­lec­tis’ know-how on gene edit­ing, will ac­cel­er­ate the work on their lead ther­a­py, with a shot at com­mer­cial­iza­tion work in late 2021 or ’22.

The tech­nol­o­gy may be still ap­pear to be quite ear­ly, but Bellde­grun paints a pic­ture of glob­al in­vestors ea­ger to get in now. 

The $300 mil­lion came to­geth­er in a mat­ter of weeks, says Bellde­grun, who adds that it would have been easy to raise twice that amount. For now, he’s not short of cash — and he says he and Chang al­so put their own mon­ey in­to the deal. As they go for­ward, con­sid­er­ing the need to build their own ded­i­cat­ed man­u­fac­tur­ing, he ex­pects they’ll be able to raise more cash as need­ed.

So why not take the mon­ey from the Kite deal and take an ex­tend­ed va­ca­tion?

“I think at the end it’s not mon­ey that dri­ves what we do,” says Chang, who was cleared to leave Kite in Feb­ru­ary af­ter stay­ing on for the tran­si­tion. “It’s re­al­ly the ac­tiv­i­ty that will sat­is­fy you, or some­thing that’s deep down in you.”

Have a new drug that promis­es to fight Covid-19? The FDA will see you now

After providing an emergency approval to use malaria drugs against coronavirus with little actual evidence of their efficacy or safety in that setting, the FDA has already proven that it has set aside the gold standard when it comes to the pandemic. And now regulators have spelled out a new approach to speeding development that promises immediate responses in no uncertain terms — promising a program offering the ultimate high-speed pathway to Covid-19 drug approvals.

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In a stun­ning set­back, Amarin los­es big patent fight over Vas­cepa IP. And its high-fly­ing stock crash­es to earth

Amarin’s shares $AMRN were blitzed Monday evening, losing billions in value as reports spread that the company had lost its high-profile effort to keep its Vascepa patents protected from generic drugmakers.

Amarin had been fighting to keep key patents under lock and key — and away from generic rivals — for another 10 years, but District Court Judge Miranda Du in Las Vegas ruled against the biotech. She ruled that:
(A)ll the Asserted Claims are invalid as obvious under 35 U.S.C.§ 103. Thus, the Court finds in favor of Defendants on Plaintiff’s remaining infringementclaim, and in their favor on their counterclaims asserting the invalidity of the AssertedClaims under 35 U.S.C. § 103.

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Once fu­ri­ous over No­var­tis’ da­ta ma­nip­u­la­tion scan­dal, the FDA now says it’s noth­ing they need to take ac­tion on

Back in the BP era — Before Pandemic — the FDA ripped Novartis for its decision to keep the agency in the dark about manipulated data used in its application for Zolgensma while its marketing application for the gene therapy was under review.

Civil and criminal sanctions were being discussed, the agency noted in a rare broadside at one of the world’s largest pharma companies. Notable lawmakers cheered the angry regulators on, urging the FDA to make an example of Novartis, which fielded Zolgensma at $2.1 million — the current record for a one-off therapy.

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Dai­ichi Sankyo sinks $200M in­to new gene ther­a­py tech from Ul­tragenyx

In a leap to the gene therapy space, Daiichi Sankyo has dropped $200 million to access Ultragenyx’s manufacturing technology, providing the rare disease biotech with plenty of cash and a stock boost amid a general cash crunch.

For $125 million in cash and a $75 million equity investment, Daiichi Sankyo has bought a non-exclusive license to the IP around two platforms with which it plans to develop AAV-based gene therapy products. The Japanese pharma is purchasing the stock $RARE at $60 per share, more than a third above its current price of $44.43.

Arie Belldegrun, Endpoints @ JPM20 Breakfast Panel. Photography by Jeff Rumans.

Mo­tion de­nied: Gilead still on the hook for $1.5B in dam­ages over CAR-T patent dis­pute with Bris­tol My­ers Squibb

Gilead’s bid to overturn a jury verdict that ordered it to pay Bristol Myers Squibb about $752 million for CAR-T patents owned by its subsidiary Juno Therapeutics has ended in vain.

The ruling leaves Gilead vulnerable to an even bigger $1.5 billion payment that Bristol is now demanding — adding fuel to the fiery criticism some analysts are already heaping on its $11.9 billion Kite buyout.

In a 30-page document unsealed on Monday, Judge James Otero of the district court in Los Angeles struck down several different arguments for a new decision. Here are Morgan Stanley analysts’ takeaways:
The court, in particular, denied Kite’s contentions (1) that Juno’s patent is invalid, (2) the damages award was unreasonable, and (3) that a new trial should take place. The court also denied Kite’s argument that its infringement was not willful.
Gilead is likely to appeal to the federal circuit, they noted, but the odds are not in their favor as the same standard for evidence will be applied in that court. Appeals typically take 16 months.

A quiver of ar­rows for im­mune dis­or­ders: Pan­dion scores $80M in fresh fund­ing

Scientists began with making recombinant versions of naturally-occurring human proteins, then graduated to monoclonal antibodies. Now, rather than replicating moieties within the body, researchers are modifying these molecules to have precise biology in a functional manner.

This technology, referred to as bispecific antibodies, is already being employed to fight cancer. In early 2018, Pandion Therapeutics was born to reverse-engineer the science into the realm of autoimmune and inflammatory disorders.

Covid-19 roundup: GSK, Am­gen tai­lor R&D work to fit the coro­n­avirus age; Doud­na's ge­nomics crew launch­es di­ag­nos­tic lab

You can add Amgen and GSK to the list of deep-pocket drug R&D players who are tailoring their pipeline work to fit a new age of coronavirus.

Following in the footsteps of a lineup of big players like Eli Lilly — which has suspended patient recruitment for drug studies — Amgen and GSK have opted to take a more tailored approach. Amgen is intent on circling the wagons around key studies that are already fully enrolled, and GSK has the red light on new studies while the pandemic plays out.

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It is 'kind of a proven tech­nol­o­gy': Hep B vac­cine mak­er joins glob­al hunt for coro­n­avirus vac­cine

Using lab-grown proteins that are engineered to mimic the architecture of viruses to induce an immune response, VBI Vaccines is joining the hunt for a coronavirus vaccine — harnessing technology that has initially been proved safe in early trials as a prophylactic for cytomegalovirus (CMV) infection.

Unlike the raft of the companies in the Covid-19 vaccine race — including Moderna, CureVac and J&J — VBI is taking a pan-coronavirus approach, by developing a vaccine that will encompass Covid-19, severe acute respiratory syndrome (SARS), and Middle East respiratory syndrome (MERS).

Can a pair of top AveX­is alum­ni steer a new gene ther­a­py up­start to R&D glo­ry? 3 VCs bet $60M on it

VCs love few things more than a proven executive team when it comes to launching a new company. And now a group of A-listers has turned to a pair of top execs out of AveXis to steer the latest gene therapy player into the clinic.

The biotech is Waltham, MA-based Affinia and the two execs are Sean Nolan and Rick Modi — the former CEO and CBO respectively of AveXis, the gene therapy pioneer that fetched $8.7 billion in a sale to Novartis. Nolan has now taken the chairman’s role at Affinia while Modi moves up to the CEO post at the company.