Back to the beginning: Pfizer seeds discovery-stage neuro startup Magnolia (after axing its own brain R&D)
After yanking its own neuroscience efforts — and retreating from the failure-strewn battleground of brain science — Pfizer is pedaling back to the beginning in this field. The pharma giant is funding a brand-new MD Anderson spinout that’s questioning the very basics of neurodegeneration.
The startup, called Magnolia Neurosciences (“Magnolia” as a nod to its Texas roots), is being rather tightlipped about what it’s working on. But CEO Thong Le tells me the company is steering away from traditional efforts in the field.
In short, the startup is tapping a body of literature around a biological process that occurs in the womb during the earliest stages of life. When an embryo is forming, the body trashes excess neurons in a process called “programmed cell death.” Research shows that this same process is reactivated in the brain throughout the course of Alzheimer’s disease, among other neuro conditions. Magnolia is hypothesizing that blocking specific components of this process will preserve brain tissue in humans and — hopefully — prevent memory loss. That’s what they’ve seen in mouse models, anyway.
“Not only can you preserve brain tissue and enhance memory, but — from a more biological point of view — you could dramatically change the course and development of neurological disease,” Le said.
To get to work on the idea, Magnolia has rounded up $31 million in a Series A packed with high profile corporate VCs. The stellar syndicate was put together by Accelerator Life Science Partners, a startup factory that churns out these ventures by shopping academic labs and other hubs of innovation around the globe. Once they find something promising, they put together a team and spin the tech out into a startup of its own.
It should be noted that Le is the CEO at Accelerator, which is why he’s heading up Magnolia for the time being.
Accelerator has satellites in New York, Seattle, and San Diego, and has launched seven startups since its inception. One of their ventures is Lodo Therapeutics, the New York-based company that scored a $969 million (biobucks) deal with Genentech in metagenomics earlier this year.
Magnolia managed to attract a slew of corporate VCs, including the aforementioned Pfizer, Eli Lilly, AbbVie Ventures, and Johnson & Johnson Innovation, among others. You can see the full list on the company’s press release.
After scrapping its own neuroscience work earlier this year, some might see Pfizer’s investment in startups as putting a bandaid over a gaping hole. But the pharma giant is making an effort to seed innovation outside of its own labs. In June, the company committed an additional $150 million to its VC group to invest in neuroscience startups. This investment in Magnolia is one of the first bets, it seems.
Le said it actually makes a lot of sense for large pharmaceutical companies to leave the early discovery work to smaller biotechs.
“When it comes to developing drugs for complex diseases like Alzheimer’s, to some extent we’re mucking with biology that we don’t really have a perfect understanding of, which requires taking calculated risk from a development perspective,” he said. “Large pharma companies that are publicly traded don’t have as much flexibility as they’d like to have in terms of being agile and taking the leaps of faith needed to push an early stage program aggressively forward.”
Le said this latest round of funding should move Magnolia toward clinical development, although he’s not sharing timelines just yet.
Image: Accelerator and Magnolia CEO Thong Le. Magnolia