Goodbye, San Francisco. Stanford spinout heads to Houston after bagging a $20M CPRIT grant

Ray Tabibiazar

Ray Tabibiazar

Two years ago an associate professor of bioengineering at Stanford named Jennifer Cochran and co-author Amato Giaccia came up with a new approach for throwing a monkey wrench into the mechanics of metastasis. Picking up on the role that a pair of Gas6 proteins play when they link to two Axl proteins — a subfamily of receptor tyrosine kinases found on the surface of cancer cells, allowing them to roam from a tumor — they developed a decoy protein that harmlessly binds to Gas6 and scrambles the untethering process, effectively taking it out of the biologic loop.

The approach worked to blunt metastasis in mice, and a low-profile startup named Ruga Corporation landed the rights — one of a wave of biotech startups in the Bay Area.

And this one came with a very prominent endorsement.

“It is a beautiful piece of biochemistry and has some nuances that make it particularly exciting,” noted Glenn Dranoff. At the time Dranoff was a Dana-Farber investigator. Dranoff joined NIBR last year to run their immuno-oncology work.

Today, Ruga Corp. is officially changing its name to Aravive, and it’s making an unusual switch in locales, changing its Bay Area address in the heart of a top biotech hub for Houston, with a $20 million injection from the Lone Star state’s Cancer Prevention & Research Institute of Texas, better known as CPRIT.

Giaccia is now the CSO and co-founder at Aravive. Ray Tabibiazar, a former VC partner at Bay City Capital, is the CEO. Together, they’re focused on getting their drug into the clinic for acute myeloid leukemia.

“It’s unusual in that this is the largest amount given (by CPRIT) to one company,” Tabibiazar tells me

In the coming months the CEO says we should look out for new publications spelling out a second-gen approach to what the Stanford team put out in 2014. That’s what is pointed to the clinic in 2017, he adds. And Tabibiazar is putting together a new financing round to fully fund the early stages of development work.

As of now, the company has a staff of about 15, adds the CEO, which will grow to a maximum of about 20 for this stage of the game. As for the move to Texas, Tabibiazar adds, it makes a lot of sense to get closer to investigators at Baylor and MD Anderson, where they’ve already been doing work on this target.

CPRIT has been raising the ante on its biotech bet this month after a four-year bout of on-again, off-again controversies.

Houston-based Bellicum Pharmaceuticals just won a recommendation for a $16.9 million CPRIT grant to support its clinical work for BPX-501 in pediatric AML. And that was part of $93 million in grants issued November 16.

The state set up the $3 billion CPRIT bond initiative to support cancer research back in 2007, and it’s been in and out of the headlines over accusations of favoritism and bias related to some of the biotechs it’s backed as well as its ties to three prominent institutions: MD Anderson in Houston, UT Southwestern in Dallas, and Baylor — which have collectively snared close to half of the cash handed out so far.

While the state project has played a prominent role in academic research, the development of a biotech hub has advanced in fits and starts, with MD Anderson stepping up and helping with a series of spinouts and collaborations over the past year.

J&J Innovations also provided a big assist of its own, adding a JLabs incubator in Houston to help foster biotech startups. Aravive can help Texas make the case that it’s also bringing in new companies.

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