Valo CEO David Berry (Flagship Pioneering)

Koch's 'dis­rup­tive' VC bets $110M on one of Flag­ship's new, big com­pu­ta­tion­al star­tups

David Berry joined Flag­ship as a Har­vard and MIT wun­derkind in 2005 and by now he’s been at the firm al­most as long as any­one not named Noubar. He’s played a hand in some of their biggest star­tups, in­clud­ing Seres, Omega, KSQ, Evelo and, of course, Mod­er­na.

Flag­ship is known for its flash, but over the last cou­ple years, Berry has been qui­et­ly build­ing a com­pu­ta­tion­al start­up in Boston that he thinks can re­make drug de­vel­op­ment in a way that, for all the buzz, ma­chine learn­ing and ar­ti­fi­cial in­tel­li­gence have yet to do.

He’s man­aged to con­vince at least a few in­vestors of that vi­sion, rais­ing $100 mil­lion in a Se­ries A, $50 mil­lion in an undis­closed fi­nanc­ing and a $190 mil­lion in a Se­ries B de­spite re­main­ing far from the clin­ic. On Tues­day, Va­lo re­vealed an­oth­er in­vestor who bought in, adding $110 mil­lion from Koch Dis­rup­tive Tech­nol­o­gy, the ven­ture cap­i­tal arm of the famed and in­fa­mous hold­ing com­pa­ny Koch In­dus­tries.

Koch Dis­rup­tive Tech­nolo­gies has in­vest­ed in a broad swatch of tech com­pa­nies but not yet wad­ed deeply in­to biotech. In back­ing Va­lo, they are buy­ing in­to what Berry says is a new way of think­ing about drugs and tech and da­ta.

“As we look at the process that ex­ists in drug de­vel­op­ment or drug dis­cov­ery to­day, it’s ef­fec­tive­ly a point-to-point process and each of the steps has its own da­ta, its own way of mak­ing de­ci­sions,” Berry told End­points News. “As the drug moves through its var­i­ous steps, it’s as if it’s been thrown over a wall.”

AI and ma­chine learn­ing have large­ly been de­ployed at in­di­vid­ual steps of the drug de­vel­op­ment process: used by Atom­wise, for ex­am­ple, to screen mas­sive li­braries for the best mol­e­cule, or by In­sitro to find the dif­fer­ence be­tween dis­eased and healthy cells, and the places where de­vel­op­ers might be able to in­ter­vene and turn one to the oth­er. Sep­a­rate­ly, large phar­mas and small biotechs like Black­Thorn have used ma­chine learn­ing to de­sign tri­als and find the best pa­tients.

Berry ar­gues that we need a bet­ter sys­tem — a bet­ter plat­form — that can in­te­grate all those var­i­ous sources and ap­pli­ca­tions of da­ta from the out­set, al­low­ing com­pa­nies to over­come the hur­dles that tend to ap­pear as a drug goes through de­vel­op­ment. And that da­ta should be ground­ed in hu­mans (as op­posed to mice or mon­key ex­per­i­ments) to in­crease the odds that ba­sic lab in­sights ac­tu­al­ly trans­late in­to the clin­ic.

With about 110 em­ploy­ees, large amounts of hu­man da­ta, in­clud­ing what they claim is the “largest and most-de­tailed car­dio-meta­bol­ic dataset in the world,” and reams and reams of cloud space, they’ve built a plat­form they call Opal to do that.

For ex­am­ple, Berry claimed, they’ve de­vel­oped an al­go­rithm that al­lows them to pre­dict the tox­i­col­o­gy of any giv­en com­pound with 86% ac­cu­ra­cy. They al­so use 3D physics soft­ware to sim­u­late and de­sign mol­e­cules, adopt­ing a sim­i­lar ap­proach to the well-part­nered com­pu­ta­tion­al biotech Schrödinger, which has long ar­gued that the AI al­go­rithms many star­tups use to screen for mol­e­cules strug­gle be­cause they re­ly on 2D im­ages of 3D mol­e­cules.

“When you ask the com­put­er to try learn that a 2D im­age rep­re­sents a 3D struc­ture — that’s a very hard thing for a com­put­er to learn,” Berry said.

To find new tar­gets, the plat­form and Va­lo’s sci­en­tists com­bine “omics” da­ta – ge­nomics, pro­teomics, even the much less talked about metabolomics — with da­ta that track how pa­tients change as they age and their dis­eases progress or wane. “Dis­eases are dy­nam­ic,” he said.

Va­lo will use the new pro­ceeds to con­tin­ue hir­ing a few dozen more em­ploy­ees and progress the plat­form. With two years of run­way, it will al­so give them the cash to get in­to the clin­ic, Berry said. Al­though they haven’t gone deep in­to de­tails, Va­lo did re­lease their first batch of can­cer tar­gets ear­li­er this year: NAMPT, PARP1, USP28 and HDAC3.

Their tar­gets for neu­rode­gen­er­a­tion and car­dio­vas­cu­lar dis­ease re­main undis­closed.

The DCT-OS: A Tech­nol­o­gy-first Op­er­at­ing Sys­tem - En­abling Clin­i­cal Tri­als

As technology-enabled clinical research becomes the new normal, an integrated decentralized clinical trial operating system can ensure quality, deliver consistency and improve the patient experience.

The increasing availability of COVID-19 vaccines has many of us looking forward to a time when everyday things return to a state of normal. Schools and teachers are returning to classrooms, offices and small businesses are reopening, and there’s a palpable sense of optimism that the often-awkward adjustments we’ve all made personally and professionally in the last year are behind us, never to return. In the world of clinical research, however, some pandemic-necessitated adjustments are proving to be more than emergency stopgap measures to ensure trial continuity — and numerous decentralized clinical trial (DCT) tools and methodologies employed within the last year are likely here to stay as part of biopharma’s new normal.

Onno van de Stolpe, Galapagos CEO (Thierry Roge/Belga Mag/AFP via Getty Images)

Gala­pa­gos chops in­to their pipeline, drop­ping core fields and re­or­ga­niz­ing R&D as the BD team hunts for some­thing 'trans­for­ma­tive'

Just 5 months after Gilead gutted its rich partnership with Galapagos following a bitter setback at the FDA, the Belgian biotech is hunkering down and chopping the pipeline in an effort to conserve cash while their BD team pursues a mission to find a “transformative” deal for the company.

The filgotinib disaster didn’t warrant a mention as Galapagos laid out its Darwinian restructuring plans. Forced to make choices, the company is ditching its IPF molecule ’1205, while moving ahead with a Phase II IPF study for its chitinase inhibitor ’4617.

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Stéphane Bancel, Getty

Mod­er­na CEO brush­es off US sup­port for IP waiv­er, eyes more than $19B in Covid-19 vac­cine sales in 2021

Moderna is definitively more concerned with keeping pace with Pfizer in the race to vaccinate the world against Covid-19 than it is with Wednesday’s decision from the Biden administration to back an intellectual property waiver that aims to increase vaccine supplies worldwide.

In its first quarter earnings call on Thursday, Moderna CEO Stéphane Bancel shrugged off any suggestion that the newly US-backed intellectual property waiver would impact his company’s vaccine or bottom line. Still, the company’s stock price fell by about 9% in early morning trading.

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'Chang­ing the whole game of drug dis­cov­ery': Leg­endary R&D vet Roger Perl­mut­ter leaps back in­to work as a biotech CEO

Roger Perlmutter needs no introduction to anyone remotely involved in biopharma. As the R&D chief first at Amgen and then Merck, he’s built a stellar reputation and a prolific career steering new drugs toward the market for everything from cancer to infectious diseases.

But for years, he’s also held a less known title: science partner at The Column Group, where he’s regularly consulted about the various ideas the VCs had for new startups.

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Ad­comm splits slight­ly in fa­vor of FDA ap­prov­ing Chemo­Cen­tryx’s rare dis­ease drug

The FDA’s Arthritis Advisory Committee on Thursday voted 10 for and 8 against the approval of ChemoCentryx’s $CCXI investigational drug avacopan as a treatment for adults with a rare and serious disease known as anti-neutrophil cytoplasmic autoantibody (ANCA)-vasculitis.

The vote on whether the FDA should approve the drug was preceded by a split vote of 9 to 9 on whether the efficacy data support approval, and 10 to 8 that the safety profile of avacopan is adequate enough to support approval.

Gold­man Sachs jumps aboard Bain-backed 503(b) com­pound­ing phar­ma­cy with a $275M debt loan to sup­ply hos­pi­tals

Long the bane of the FDA’s existence, compounding pharmacies have seen a minor resurgence in the past year as short-term saviors for hospital drug shortages. Now, a 503(b) company specializing in hospital meds has earned a big backer to keep expanding its 200-drug strong portfolio.

Goldman Sachs and Owl Rock Capital Partners have doled out a $275 million debt loan to QuVa Pharma, a 503(b)-certified outsourcing facility providing compounded drugs to hospitals, the company said Thursday.

Bill Lis, Jasper Therapeutics

Jasper and its stem cell con­di­tion­ing an­ti­body earn a tick­et to Nas­daq in lat­est SPAC re­verse merg­er

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

Another biotech SPAC deal has landed as the glut of blank-check companies continues to make waves in the industry.

Thursday’s winner is Jasper Therapeutics, joining forces with Amplitude Healthcare Acquisition Corp. in a $100 million reverse-merger, Jasper announced. The deal also comes with a PIPE financing of an additional $100 million, setting Jasper up with a $490 million market cap once the merger closes in the third quarter.

Brent Saunders (Richard Drew, AP Images)

OcuWho? Star deal­mak­er turned aes­thet­ics czar Brent Saun­ders flips back in­to biotech. But who’s he team­ing up with now?

Brent Saunders went on a tear of headline-blazing deals building Allergan, merging and rearranging a variety of big companies into one before an M&A pact with Pfizer blew up and sent him on a bout of biotech drug deals. That didn’t work so well, so under pressure, he got his buyout at AbbVie — which needed a big franchise like Botox. And it was no big surprise to see him riding the SPAC wave into a recent $1 billion-plus deal that left him in the executive chairman’s seat at an aesthetics outfit — now redubbed The Beauty Health Company — holding a big chunk of the equity.

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Drug pric­ing watch­dog joins the cho­rus of crit­ics on Bio­gen's ad­u­canum­ab: What about charg­ing $2,560 per year?

As if Biogen’s aducanumab isn’t controversial enough, the researchers at drug pricing watchdog ICER have drawn up the contours of a new debate: If the therapy does get approved for Alzheimer’s by June, what price should it command?

Their answer: At most $8,290 per year — and perhaps as little as $2,560.

Even at the top of the range, the proposed price is a fraction of the $50,000 that Wall Street has reportedly come to expect (although RBC analyst Brian Abrahams puts the consensus figure at $11.5K). With critics, including experts on the FDA’s advisory committee, making their fierce opposition to aducanumab’s approval loud and clear, the pricing pressure adds one extra wrinkle Biogen CEO Michel Vounatsos doesn’t need as he orders full-steam preparation for a launch.