Versant Ventures and Celgene have extended their deal to foster a Toronto-based biotech called Northern Biologics, bringing in a Phase I-ready cancer drug through a merger with a small biotech in Barcelona and pumping in fresh funds to drive its pivot into the clinic.
The Spanish biotech is called Mosaic Biomedicals, co-founded by Joan Seoane, the director of translational research at the Vall d’Hebron Institute of Oncology in Barcelona. He’s been working on an antibody that targets leukemia inhibitory factor, or LIF, a cytokine that is over expressed on certain solid tumors. The drug is designed to block a pathway involved in cancer progression.
“Mosaic Biomedicals has a very exciting molecule — which is the first antibody targeting LIF — to go into the clinic next year,” says Northern CEO Stefan Larson, whose company was seeded by Versant Ventures. “Northern Biologic has a larger infrastructure and we saw an opportunity to bring that into Northern Biologic to accelerate our pipeline.”
“Versant increased its Series A,” he adds, “and under a built-to-buy deal, after the merger Celgene exercised options to rights to MSC1 that comes with additional funding.”
The company and its backers are keeping the terms for the addition under wraps for now, but it’s not a trivial amount. Aside from Versant’s initial $10 million round, Celgene has already sunk $30 million into the company in the spring of 2015, when it first acquired the option to buy.
Now Northern has a staff of about 30, including the new group in Barcelona, which was ID’d by Versant’s European team. Guido Magni, a partner, sits on the board at Mosaic.
Versant has been building up its presence in Canada over the last few years. And this latest deal fits into their strategy to find new biotech opportunities that can be every bit as valuable as anything you’d find in Boston/Cambridge or San Francisco.
“Basically, this is our fifth major investment in Canada,” says Brad Bolzon, a managing partner at Versant, including the recent $225 million launch of BlueRock with Bayer a few days ago. “I’m Canadian. We know there was real capability and talent, and very little biotech infrastructure to exploit that.”
“Our strategy is to invest in Canada differently, building globally competitive companies anchored on Canadian soil,” says Jerel Davis, another managing partner who also sits on the Northern board.
Versant has also been busy in Europe in finding new portfolio companies, which also sets it aside from the run-of-the-mill US VC focused on the megahubs. And beginning in 2017, Northern will start looking to back up their promise with the first round of clinical data, partnered with one of the most prolific Big Biotechs in the business.
That’s not to say that the VC ignored the US. Versant backed CRISPR Therapeutics, one of the pioneers in gene editing, which is based in Basel with an R&D operation in Cambridge. So they became a natural partner for Bayer, which partnered with CRISPR on a joint venture, when Bayer’s Axel Bouchon followed up on plans to found a new player operating in stem cells.
After years of globetrotting, Bolzon and Davis are part of a global network. And their company creation work is now in full stride. Northern is just the latest example of that.
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