Five months, $98.5M and a PhII drug from No­var­tis lat­er, Ma­gen­ta Ther­a­peu­tics is floor­ing it

Last No­vem­ber, Ma­gen­ta Ther­a­peu­tics end­ed a year of self-im­posed start­up si­lence with a hefty $48.5 mil­lion Se­ries A and a bur­geon­ing team of in­ves­ti­ga­tors fo­cused on cord blood stem cell ther­a­pies. To­day, just a lit­tle more than 5 months lat­er, it’s adding $50 mil­lion in Se­ries B cash from some mar­quee in­vestors that in­cludes the ven­ture group for­mer­ly known as Google and in-li­cens­ing a mid-stage drug that No­var­tis clear­ly thinks high­ly of for en­hanc­ing cord blood stem cells as a treat­ment.

Oh, and some of that ven­ture cash is from crossover in­vestors, spurring some added think­ing in this fledg­ling biotech about the right tim­ing on a po­ten­tial IPO.

The drug is HSC835, which is now be­ing rechris­tened as MG­TA-456. And the ther­a­py comes with da­ta from some small tri­als, help­ing ad­vance Ma­gen­ta with a full-fledged clin­i­cal pro­gram which fits neat­ly in­to Ma­gen­ta’s R&D strat­e­gy.

No­var­tis has spot­light­ed this drug for its abil­i­ty to im­prove the ther­a­peu­tic pow­er of um­bil­i­cal cord trans­plants, amp­ing up the stem cells need­ed for the en­graft­ment process to cre­ate in­fec­tion-fight­ing cells. And that’s right in Ma­gen­ta’s wheel­house.

It’s a great fit for Ma­gen­ta, CEO Ja­son Gard­ner tells me. The biotech hired in a pair of the ear­ly in­ves­ti­ga­tors on this pro­gram. And when they went to No­var­tis to sound out their in­ter­est man­ag­ing its clin­i­cal fu­ture, de­clar­ing a com­mit­ment to hus­tling it through the clin­ic, the mes­sage res­onat­ed well at the phar­ma gi­ant, which re­tains an un­spec­i­fied in­ter­est in the drug.

Ma­gen­ta is keep­ing those terms to it­self — which is gen­er­al­ly how No­var­tis likes to keep things.

The ex­tra $50 mil­lion that just ar­rived in an ac­cel­er­at­ed Se­ries B will al­so help the biotech ex­pand its fo­cus on can­cer, ge­net­ic dis­eases and au­toim­mu­ni­ty.

GV (for­mer­ly Google Ven­tures) led the round, with par­tic­i­pa­tion from all ex­ist­ing in­vestors, in­clud­ing At­las Ven­ture, Third Rock Ven­tures, Part­ners In­no­va­tion Fund and Ac­cess In­dus­tries. The fi­nanc­ing al­so in­clud­ed Cas­din Cap­i­tal and oth­er crossover in­vestors, as well as Be The Match Bio­Ther­a­pies, a sub­sidiary of Na­tion­al Mar­row Donor Pro­gram. And Be The Match Bio­Ther­a­pies — with its 178 US trans­plant cen­ters — is al­ly­ing with the biotech as it push­es ahead with new clin­i­cal tri­als.

We’re a long way from the 2014 biotech IPO boom, which was the last time you could flip a start­up in­to Nas­daq. But the CEO is hap­py to con­cede that the sub­ject has come up in­side the com­pa­ny.

“We have dis­cussed that op­tion,” says Gard­ner. “We like that op­tion.” But there are lots of op­tions to con­sid­er right now, he adds, in­clud­ing do­ing some non-di­lu­tive deals.

Says Gard­ner: “We like to have all the op­tions avail­able to the com­pa­ny.”

Out-li­cens­ing is not a new strat­e­gy for No­var­tis. Just last March No­var­tis de­cid­ed to spin out a pair of an­ti-ag­ing ther­a­peu­tics to a PureTech start­up, the lat­est in a se­ries of out-li­cens­ing deals for a com­pa­ny that has been care­ful to fo­cus on the core strat­e­gy un­der Chair­man Jo­erg Rein­hardt, who’s keen­ly in­ter­est­ed in main­tain­ing a rel­a­tive­ly con­ser­v­a­tive re­search fo­cus at the phar­ma gi­ant as rev­enue flat­tened and then de­clined.

For Gard­ner, a GSK vet who was sent to Cam­bridge to help scout new ther­a­pies for the phar­ma gi­ant and wound up get­ting sucked in­to At­las’ start­up world, the ac­cel­er­a­tion at Ma­gen­ta feels fine.

By the end of this year, says Gard­ner, he ex­pects the 26-mem­ber team at Ma­gen­ta to grow to about 40. And along the way will come more da­ta and a clear out­line of de­vel­op­ment time­lines that will put this biotech way ahead of most any fledg­ling to pop up in the Boston hub.

No­var­tis reshuf­fles its wild cards; Tough sell for Bio­gen? Googling pro­teins; Ken Fra­zier's new gig; and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

If you enjoy the People section in this report, you may also want to check out Peer Review, my colleagues Alex Hoffman and Kathy Wong’s comprehensive compilation of comings and goings in biopharma.

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Demis Hassabis, DeepMind CEO (Qianlong/Imaginechina via AP Images)

Google's Deep­Mind opens its pro­tein data­base to sci­ence — po­ten­tial­ly crack­ing drug R&D wide open

Nearly a year ago, Google’s AI outfit DeepMind announced they had cracked one of the oldest problems in biology: predicting a protein’s structure from its sequence alone. Now they’ve turned that software on nearly every human protein and hundreds of thousands of additional proteins from organisms important to medical research, such as fruit flies, mice and malaria parasite.

The new database of roughly 350,000 protein sequences and structures represents a potentially monumental achievement for the life sciences, one that could hasten new biological insights and the development of new drugs. DeepMind said it will be free and accessible to all researchers and companies.

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In­side Bio­gen's scram­ble to sell Aduhelm: Pro­ject 'Javelin' and pres­sure to ID as many pa­tients as pos­si­ble

In anticipation of Aduhelm’s approval for Alzheimer’s in June, Biogen employees were directed to identify and guarantee treatment centers would administer the drug through a program called “Javelin,” a senior Biogen employee told Endpoints News.

The program identified about 800 centers for use, he said, and Biogen now pays for the use of bioassays to identify beta amyloid in potential patients having undergone a lumbar puncture procedure, the employee said — and one center preparing to administer the drug confirmed its participation in the bioassay program.

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Vas Narasimhan, Novartis CEO (Jason Alden/Bloomberg via Getty Images)

No­var­tis dis­cards one of its ‘wild card’ drugs af­ter it flops in key study. But it takes one more for the hand

Always remember just how risky it is to gamble big on small studies.

A little more than 4 years ago, Novartis reportedly put up a package worth up to $1 billion for the dry eye drug ECF843 after a small biotech called Lubris put it through its paces in a tiny study of 40 moderate to severe patients, tracking some statistically significant markers of efficacy.

By last fall, the program had risen up to become one of CEO Vas Narasimhan’s top “wild card” programs in line for a potential breakthrough year in 2021. These drugs were all considered high-risk, high-reward efforts. And in this case, risk won.

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UP­DAT­ED: Three biotechs price hefty IPOs just be­fore the week­end, while a fourth and a SPAC seek spots on Wall Street

Editor’s note: Interested in following biopharma’s fast-paced IPO market? You can bookmark our IPO Tracker here.

A handful of biotechs are hitting Wall Street just before the start of the weekend, with three companies — Caribou Biosciences, Sophia Genetics and Absci — all pricing big raises Wednesday and Thursday. Gamma delta T cell-focused IN8bio relaunched its IPO campaign months after postponing it last November, seeking a slightly lower raise. And another SPAC has filed for a public debut.

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Victor Perlroth, Kodiak Sciences CEO

Ko­di­ak turns down $125M pay­ment from Bak­er Bros. deal, slash­es roy­al­ty cap by 55%

Following a massive public raise last November, Kodiak Sciences has re-worked a royalty sale agreement with an old partner — and declined new funds in the process.

Kodiak is turning down a planned $125 million payment from Baker Bros. Advisors, according to an SEC filing, cutting short an agreement that saw the biotech hand over a 4.5% stream of royalty sales on its experimental anti-VEGF therapy KSI-301 for retinal vascular diseases. In conjunction with the move, Kodiak is shrinking the royalty cap from just over $1 billion to $450 million.

EMA re­jects FDA-ap­proved Parkin­son's drug, signs off on Mod­er­na vac­cine use in ado­les­cents ahead of FDA

The European Medicines Agency on Friday rejected Kyowa Kirin’s Parkinson’s disease drug Nouryant (istradefylline), which the US FDA approved in 2019 under the brand name Nourianz.

EMA said it considered that the results of the clinical studies used to support the application “were inconsistent and did not satisfactorily show that Nouryant was effective at reducing the ‘off’ time. Only four out of the eight studies showed a reduction in ‘off’ time, and the effect did not increase with an increased dose of Nouryant.”

6 top drug­mak­ers of­fer per­spec­tives on FDA's new co­vari­ates in RCTs guid­ance

Back in May, the FDA revised and expanded a 2019 draft guidance that spells out how to adjust for covariates in the statistical analysis of randomized controlled trials.

Building on the ICH’s E9 guideline on the statistical principles for clinical trials, the 3-page draft was transformed into an 8-page draft, with more detailed recommendations on linear and nonlinear models to analyze the efficacy endpoints in RCTs.

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Mol­e­c­u­lar Di­ag­nos­tics Can Trans­form Can­cer Care. Let’s Make It Hap­pen.

Like so many people around the world, my life has been profoundly shaped by cancer. Those personal experiences, along with a deep love of clinical laboratory science and a passion to apply the power of genomics in medicine, motivated me to launch a company that would improve cancer care through better diagnostics. Thirteen years later, I am proud that we are delivering more accurate information at multiple points along the patient journey, with a focus on eight of the 10 cancers that are most commonly diagnosed in the United States.