Thursday, May 21, 2009

GSK’s Tempero: Pushing Entrepreneurialism to the Limit?

We’re not sure why they didn’t shout about it, but GlaxoSmithKline has, according to a report in Xconomy last week, stealthily launched Tempero Pharmaceuticals, a Cambridge, MA-based start-up focused on regulatory T-cells for treatments in auto-immune disease and inflammation.

Jose Carlos Gutierrez-Ramos, head of the Immuno-Inflammation Center of Excellence for Drug Discovery at GSK that has seeded this newco, had flagged up the project to IN VIVO for this February feature. We blogged it here, too, but heard nothing since.

And yet “this is a very exciting project for us,” JC confirmed today to The IN VIVO Blog. Indeed, Tempero—though not technically a spin-out—takes GSK’s ongoing Drug Performance Unit (DPU) R&D experiment a step further. Need a refresher? The Big Pharma is already trying to foster a biotech-like culture internally, through the creation last year of these small, pathway-focused DPUs, each on a three-year funding cycle overseen by an investment board that includes a couple of external CEOs and VCs too.

Tempero, though, is (or will be) a fully external DPU—the plan is to bring VCs in on a later B round. If they come, that would provide the sort of outside validation GSK’s after for what will become GSK assets. Gutierrez-Ramos explained in February that GSK will buy back those investors at a certain return—granted, presumably, clinical milestones are met—thus providing them with a pre-determined exit.

"Pre-determined exit" and "certain return" probably sound rather sweet these days to VC ears. The devil is in the detail---figuring out what return will be enough for the VCs, and worthwhile for GSK. And the timeframe for all this.

GSK isn't commenting on any of those questions, or indeed on Tempero, other than to say that:

".....GSK has created a new Discovery Performance Unit which will be a separate company dedicated to researching and discovering small molecule drug candidates targeted to regulatory T-cells and effector Th 17 cells, which are thought to play a key role in autoimmune diseases. We believe its planned status as a stand alone company will stimulate innovation and provide the flexibility to respond to research leads, thus creating the best chance of success."
Of course, the point for GSK is to share more R&D risk, as it and other Big Pharma are doing as much as they can, including via the increasingly popular option-based deal structure. In this case, though, rather than share risk with an existing biotech partner, GSK has created one itself and gone directly to VCs to unload risk—since it apparently couldn’t find an existing company with the focus it was after.

Gutierrez-Ramos earlier described the Tempero set-up as “pushing entrepreneurialism to the limit,” and “forcing these guys [within the company] to deliver.” Just how much forcing the external VCs will need isn’t clear, but hopefully GSK will have more to say at that point.

image by flickrer su-lin used under a creative commons license

1 comment:

Arthur said...

"Certain return"???

As long as GSK has the OPTION of re-acquiring the assets, the return for investors remains far from certain...