With No­var­tis and Google jump­ing in, Medicxi un­veils a $300M late-stage biotech fund with a transat­lantic scope

The Eu­ro­pean ven­ture group Medicxi is stak­ing out some new ter­rain in biotech in­vest­ing. And they’re bring­ing in two big play­ers — No­var­tis and Google’s Ver­i­ly — as key back­ers.

Known for a long­time strat­e­gy that clear­ly and care­ful­ly con­cen­trates their at­ten­tion on sin­gle-as­set or­ga­ni­za­tions that start out ear­ly on a lim­it­ed bud­get, Medicxi has added a new, $300 mil­lion fund that will fo­cus on late-stage biotech in­vest­ments. But they still want to fall in love with a top drug be­fore they buy in.

“This is the first time we’ve done a late-stage fund,” co-founder and part­ner Francesco De Ru­ber­tis told me in a pre­view of their an­nounce­ment.

The fo­cus for its Medicxi Growth 1 — MG1 — fund will start on pro­grams at the Phase IIb lev­el, man­aged by ful­ly de­vel­oped com­pa­nies with the kind of man­age­ment teams that they be­lieve can go all the way. And they’ll be of­fer­ing an al­ter­na­tive route to com­pa­nies that might oth­er­wise feel the need to jump­start an IPO, part­ner out on un­fa­vor­able terms or look too ear­ly to the US mar­kets for the fi­nan­cial fire­pow­er need­ed to ex­e­cute a promis­ing Phase III ef­fort.

“We will still in­vest when we get con­vinced by one as­set,” adds De Ru­ber­tis.

I’ve known the Medicxi part­ners — a group that in­cludes David Grainger, Kevin John­son and Michèle Ol­lier — for years now, and I asked De Ru­ber­tis for a lit­tle bet­ter idea of what he was look­ing for. He quick­ly turned to Gen­mab, one of Eu­rope’s biggest biotechs, which his group helped launch. They want to find the next Gen­mab or Acte­lion at a time they can make a key as­sist.

While quite a few crossover in­vestors that like to go for mez­za­nine rounds are look­ing for a re­turn in 12 to 18 months, Medicxi won’t be hap­py un­less they can go for the long haul.

To do that, they’ll al­ly with a dozen com­pa­nies over the next two or three years, 8 or 9 in Eu­rope and the rest in the US, able to put up $20 or $30 mil­lion each.

Ear­li­er funds have al­ready lined this ven­ture group up with J&J and GSK. Now the multi­na­tion­al No­var­tis is step­ping in, tak­ing its own pa­tient ap­proach in iden­ti­fy­ing the most am­bi­tious biotechs they may want to work with more di­rect­ly at some point along the way.

Giuseppe Zoc­co

Google more broad­ly, he adds, has iden­ti­fied health­care as a huge field they would like to grad­u­al­ly build their busi­ness in. This new fund ex­tends Ver­i­ly’s reach in Eu­rope.

The Eu­ro­pean In­vest­ment Fund al­so got in­volved in this fund.

Giuseppe Zoc­co, co-founder of In­dex Ven­tures and co-leader of the firm’s first growth fund in 2007, will be re­spon­si­ble for this new ven­ture. And they’re adding a few new play­ers to help pick up the ex­tra load.

In less than two years Medicxi has now raised more than $500 mil­lion for what is now a two-prong strat­e­gy to go ear­ly and late on its biotech in­vest­ments. You should ex­pect to hear more from them in the near fu­ture.

Norbert Bischofberger. Kronos

Backed by some of the biggest names in biotech, Nor­bert Bischof­berg­er gets his megaround for plat­form tech out of MIT

A little over a year ago when I reported on Norbert Bischofberger’s jump from the CSO job at giant Gilead to a tiny upstart called Kronos, I noted that with his connections in biotech finance, that $18 million launch round he was starting off with could just as easily have been $100 million or more.

With his first anniversary now behind him, Bischofberger has that mega-round in the bank.

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Francesco De Rubertis

Medicxi is rolling out its biggest fund ever to back Eu­rope's top 'sci­en­tists with strange ideas'

Francesco De Rubertis built Medicxi to be the kind of biotech venture player he would have liked to have known back when he was a full time scientist.

“When I was a scientist 20 years ago I would have loved Medicxi,’ the co-founder tells me. It’s the kind of place run by and for investigators, what the Medicxi partner calls “scientists with strange ideas — a platform for the drug hunter and scientific entrepreneur. That’s what I wanted when I was a scientist.”

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Af­ter a decade, Vi­iV CSO John Pot­tage says it's time to step down — and he's hand­ing the job to long­time col­league Kim Smith

ViiV Healthcare has always been something unique in the global drug industry.

Owned by GlaxoSmithKline and Pfizer — with GSK in the lead as majority owner — it was created 10 years ago in a time of deep turmoil for the field as something independent of the pharma giants, but with access to lots of infrastructural support on demand. While R&D at the mother ship inside GSK was souring, a razor-focused ViiV provided a rare bright spot, challenging Gilead on a lucrative front in delivering new combinations that require fewer therapies with a more easily tolerated regimen.

They kept a massive number of people alive who would otherwise have been facing a death sentence. And they made money.

And throughout, John Pottage has been the chief scientific and chief medical officer.

Until now.

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Chas­ing Roche's ag­ing block­buster fran­chise, Am­gen/Al­ler­gan roll out Avastin, Her­ceptin knock­offs at dis­count

Let the long battle for biosimilars in the cancer space begin.

Amgen has launched its Avastin and Herceptin copycats — licensed from the predecessors of Allergan — almost two years after the FDA had stamped its approval on Mvasi (bevacizumab-awwb) and three months after the Kanjinti OK (trastuzumab-anns). While the biotech had been fielding biosimilars in Europe, this marks their first foray in the US — and the first oncology biosimilars in the country.

Seer adds ex-FDA chief Mark Mc­Clel­lan to the board; Her­cules Cap­i­tal makes it of­fi­cial for new CEO Scott Bluestein

→ On the same day it announced a $17.5 million Series C, life sciences and health data company Seer unveiled that it had lured former FDA commissioner and ex-CMS administrator Mark McClellan on to its board. “Mark’s deep understanding of the health care ecosystem and visionary insights on policy reform will be crucial in informing our thinking as we work to bring our liquid biopsy and life sciences products to market,” said Seer chief and founder Omid Farokhzad in a statement.

Daniel O'Day

No­var­tis hands off 3 pre­clin­i­cal pro­grams to the an­tivi­ral R&D mas­ters at Gilead

Gilead CEO Daniel O’Day’s new task hunting up a CSO for the company isn’t stopping the industry’s dominant antiviral player from doing pipeline deals.

The big biotech today snapped up 3 preclinical antiviral programs from pharma giant Novartis, with drugs promising to treat human rhinovirus, influenza and herpes viruses. We don’t know what the upfront is, but the back end has $291 million in milestones baked in.

Vas Narasimhan, AP Images

On a hot streak, No­var­tis ex­ecs run the odds on their two most im­por­tant PhI­II read­outs. Which is 0.01% more like­ly to suc­ceed?

Novartis CEO Vas Narasimhan is living in the sweet spot right now.

The numbers are running a bit better than expected, the pipeline — which he assembled as development chief — is performing and the stock popped more than 4% on Thursday as the executive team ran through their assessment of Q2 performance.

Year-to-date the stock is up 28%, so the investors will be beaming. Anyone looking for chinks in their armor — and there are plenty giving it a shot — right now focus on payer acceptance of their $2.1 million gene therapy Zolgensma, where it’s early days. And CAR-T continues to underperform, but Novartis doesn’t appear to be suffering from it.

So what could go wrong?

Actually, not much. But Tim Anderson at Wolfe pressed Narasimhan and his development chief John Tsai to pick which of two looming Phase III readouts with blockbuster implication had the better odds of success.

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On a glob­al romp, Boehringer BD team picks up its third R&D al­liance for Ju­ly — this time fo­cused on IPF with $50M up­front

Boehringer Ingelheim’s BD team is on a global deal spree. The German pharma company just wrapped its third deal in 3 weeks, going back to Korea for its latest pipeline pact — this time focused on idiopathic pulmonary fibrosis.

They’re handing over $50 million to get their hands on BBT-877, an ATX inhibitor from Korea’s Bridge Biotherapeutics that was on display at a science conference in Dallas recently. There’s not a whole lot of data to evaluate the prospects here.

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Servi­er scoots out of an­oth­er col­lab­o­ra­tion with Macro­Gen­ics, writ­ing off their $40M

Servier is walking out on a partnership with MacroGenics $MGNX — for the second time.

After the market closed on Wednesday MacroGenics put out word that Servier is severing a deal — inked close to 7 years ago — to collaborate on the development of flotetuzumab and other Dual-Affinity Re-Targeting (DART) drugs in its pipeline.

MacroGenics CEO Scott Koenig shrugged off the departure of Servier, which paid $20 million to kick off the alliance and $20 million to option flotetuzumab — putting a heavily back-ended $1 billion-plus in additional biobuck money on the table for the anti-CD123/CD3 bispecific and its companion therapies.