Pfizer spins off drug orphans into a PhIII-ready startup backed by Bain to the tune of $103M
Like a lot of Big Pharma companies with a big pipeline, Pfizer can’t develop all the drugs it has. So what do you do with the good drugs that still can’t make the cut?
In Pfizer’s case, you spin a lineup of your best, furthest advanced experimental meds into a new company, while looking to add more when the time is ripe.
Lara Sullivan, an R&D strategy exec, has gained the company’s support to split off from the pharma giant with four of its clinical-stage orphans, creating a new company called SpringWorks Therapeutics. And with considerable help from two big Bain funds, they’re starting out with a mega-round of $103 million for the Series A.
Sullivan, the newly unveiled president of SpringWorks, says she gained considerable support for this new venture from Pfizer’s chief medical officer Freda Lewis-Hall, who is taking a board spot on SpringWorks to help oversee the future of these drugs, with Pfizer lending its financial support alongside Bain Capital Life Sciences, Bain Capital Double Impact, Orbimed and LifeArc.
It’s no easy task grabbing four drugs out of the pipeline at a global operation like Pfizer, even if they haven’t made the cut on R&D funding.
“I’ve got a couple of more gray hairs than I did a few years ago,” Sullivan tells me, when she got started pursuing this project. Lewis-Hall helped champion the effort, and then they built support among the company’s lawyers, accountants and scientists, who are only too aware that even in a top 10 R&D outfit like Pfizer there are far more development projects than money to fund the work.
Sullivan tells me they’re still growing the staff, but the top positions are occupied by some high-profile figures in the industry — from Chairman Dan Lynch, to Bain Capital Double Impact’s Deval Patrick, the former governor of Massachusetts, on the board. Stephen Squinto, a co-founder and former R&D chief of Alexion — now a venture partner at OrbiMed — is stepping in as acting head of research at the upstart. Jeff Schwartz, a general partner at Bain’s recently created life sciences group alongside Adam Koppel, is also taking a spot on the board.
SpringWorks is a direct outgrowth of an increasingly common strategy that is finding an abundance of deep-pocket players — including some major outfits that are new to the game — who are ready to gamble hundreds of millions of dollars on drug R&D.
Just like Vivek Ramaswamy, who’s built a growing biotech enterprise with multiple tentacles around Roivant Sciences with the castoffs to be found in Big Pharma, Wharton grad Sullivan found a way to jumpstart a mature biotech with a pipeline of advanced assets with human data. And with a slate of new CEOs taking over major R&D shops, shifting focus and reallocating funds, this is one trend that seems to be gaining momentum.
It doesn’t stop here, either, for SpringWorks. Sullivan and her team are working with Pfizer and others in the industry and academia to find more clinical-stage drugs they can add to the pipeline to grow the company even further.
SpringWorks has plenty on its plate to get started. Pfizer, like most of the major pharma companies, tends to stick to its late-stage pipeline when they talk up R&D, so these drugs have been flying largely under the radar.
To get into the SpringWorks pipeline, the drugs had to pass two familiar challenges in the biotech world: Was it targeting a disease where there are no good drugs to choose from? And was there enough hard science to back up their potential in making the grade with pivotal data?
Based on their work at Pfizer so far, there are plenty more like this out there.
“We anticipate there will be plenty of more compounds,” says Sullivan.
At this stage, there’s no telling exactly how long the $103 million will last, though they expect at a minimum to get through the late-stage work on mid-stage proof-of-concept studies on the 4. The company has a set of big names behind it, but the staff is still under 10, though growing fast.