Deals Of The Week: Vaxxas To Help Shape The Next Generation Of Vaccines

Australian/U.S. biotech Vaxxas came out of stealth mode Oct. 8, announcing a deal with Merck & Co. in which the biotech’s proprietary Nanopatch technology will be tested with Merck vaccines as a delivery vehicle offering potential advantages for ease of administration and potency.

Based on technology developed in the lab of Dr. Mark Kendall at Australia’s University of Queensland, Nanopatch, a patch delivery system said to induce robust immune system activation by targeting vaccine to immunological cells just below the patient’s skin surface, may offer Vaxxas a string of licensing deals, including milestone payments and royalties, similar to a biotech offering small- or large-molecule drug candidates to bigger companies.

“As a vaccine-delivery mode, Nanopatch is capable of delivering a very potent immunogenic response that in some respects is akin to what you’d see in using an adjuvant. We call it a physical adjuvant,” Vaxxas CEO David Hoey told Deals of the Week. “Even though our business model is to partner with companies that are producing vaccines, we believe that use of the patch actually can provide a lot more than simply a delivery vehicle can by making vaccines more potent and perhaps opening new windows for use of vaccines in development.”

Merck and Vaxxas are not disclosing which vaccine will be tested with the technology. The agreement calls for Merck to make an undisclosed upfront payment and R&D funding and then pay potential development and approval milestones plus royalties on commercial sales for a vaccine which Vaxxas will test with the Nanopatch system. Merck gets an option to an exclusive license to produce a vaccine using Nanopatch, meaning that Vaxxas will not partner its technology with another company selling or developing a vaccine for the same indication.

The pharma also gets the option to expand the agreement to two additional vaccine types, although Hoey said exclusivity for additional indications will have to be negotiated between the two companies. “The structure of the initial vaccine candidate agreement is exclusive and has been defined, and the subsequent vaccine candidates have the potential to be exclusive but have not been defined yet,” he said. “At present, we have a landscape of opportunity minus the vaccine field that we’ve licensed under this arrangement with Merck.”

While R&D will continue in Australia at Kendall’s labs, Vaxxas also has opened an 18-person office in Cambridge, Mass., which  will focus on business development. The Boston area was chosen because it offers numerous potential licensing partners for the Nanopatch technology, added Hoey, previously the VP of business development at PathoGenetix.

Vaxxas raised a $15 million Australian (about $16 million) Series A in August 2011 backed by Australian venture capital firms OneVentures and Brandon Capital, U.S. VC firm HealthCare Ventures LLC and an Australian non-profit, Medical Research Commercialisation Fund. It was the largest venture round for an Australian company since anti-infectives biotech Avexa raised $12 million Australian in 2004.

Nanopatch is a stamp-sized device designed for painless vaccination over a period of two minutes. Providing direct access to immune cells in the skin, the self-administered, needle-free vaccine delivery system contains a nano-projection array patch to which the drug is dry-coated, so there is no need for refrigeration. It was tested in animals to deliver a flu vaccine at 1/150 the dose compared with syringe administration and also has been evaluated for vaccines for human papillomavirus, human simplex virus, Chikungunya disease and West Nile virus.

The patches are produced in the same facilities that manufacture chips for cell phones and computers, Hoey said. They are coated with projections a micron in length using a high-density array that can apply thousands to tens of thousands of projections to a single patch. A dry, needle-free delivery system, Hoey said he is confident the technology can work with many different companies’ vaccines without great formulation challenges.

“Most vaccines today are derived as liquids because needles and syringes are the predominant delivery method, however, the work that has been done by Kendall shows that by a pretty standard set of steps you can prepare a vaccine to be deposited and dried down on a patch,” he explained. “There’s a series of excipients that can be added to existing vaccines to make them adaptable in a format suitable for use in conjunction with the patch. So there’s no specific formulation required of the vaccine provider.”

In searching for partners, Vaxxas is not prioritizing certain indications but trying to position itself by sharing data with vaccine makers showing the technology’s potential to increase vaccine potency and offer the possibility of easier dosing, possibly even self-administration. And Vaxxas will not compete with its partners, Hoey said; the firm has no plans to develop its own vaccines using the Nanopatch technology.

Elsewhere, it was a busy week in biopharma deal-making, as we detail in our latest edition of  …

AstraZeneca/Ardelyx: In its first deal under new CEO Pascal Soriot, AstraZeneca is licensing a Phase IIb-ready kidney drug from privately held Ardelyx. Announced Oct. 7, the deal brings AstraZeneca worldwide rights to oral NHE sodium transport inhibitor RDX5791, as well as other compounds in Ardelyx’s NHE3 inhibitor program. The Fremont, Calif.-based biotech receives an upfront payment of $35 million and can earn up to $237.5 million in development and commercial milestones, along with potential double-digit royalties on product sales. NHE3 is sodium-hydrogen antiporter 3, a protein essential to absorption of sodium by the intestines. The two companies believe these compounds can address end-stage renal disease, chronic kidney disease and other disorders related to sodium and fluid overload. Ardelyx has evaluated ‘5791 in a Phase IIa trial in constipation-predominant irritable bowel syndrome as well as a pair of Phase I studies in healthy subjects to determine the compound’s ability to divert sodium absorption from the gastrointestinal tract. The deal gives Ardelyx an option to co-promote ‘5791 in the U.S. AstraZeneca will assume development costs for the drug, while the biotech will conduct Phase IIb studies. - Joseph Haas

Roche/Inception: A drug-hunting venture borne out of the Bristol-Myers Squibb/Amira Pharmaceuticals buyout in 2011 has resulted in a new opportunity for Roche. Under a novel collaboration structure involving big pharma, venture capital and biotech, Inception Science will create a third company – called Inception 3 – to discover and develop small molecule drug candidates for sensorineural hearing loss based on technology licensed from Stanford University. Roche, which will fund Inception 3’s work with milestone-based R&D payments, will hold an option to acquire the program upon the filing of the first IND based on the Stanford technology. Inception’s backer Versant Ventures, meanwhile, will provide the equity financing for the new company, under an agreement announced Oct. 10. Inception, which consists of two current small biotechs (Inception 1 and Inception 2) focused on neurology and oncology, arose from assets spun out by Bristol after it acquired Amira for $325 million upfront in July 2011. Bristol’s focus was on idiopathic pulmonary fibrosis candidate AM152, and it spun out much of Amira’s remaining intellectual property into Inception, backed by Versant and led by former Amira CEO Peppi Prasit, known around the biopharma industry for his “drug-hunting” acumen. The various parties are not disclosing any financial details about the collaboration nor providing a timeline to the potential IND filing at FDA. However, Clare Ozawa, chief business officer at Inception and a former officer at Versant, said the combined capabilities of Inception and Roche should result in rapid progress toward a clinical candidate. “Because we’re combining capabilities across both Roche and Inception, we think we have the fastest ability possible to get to IND stage as quickly as possible,” she said in an interview. - JAH

GlaxoSmithKline/Aeras: The joint development of a tuberculosis vaccine, expected to be of use in addition to BCG vaccine to prevent pulmonary TB, is the aim of a collaboration also announced Oct. 10 between GlaxoSmithKline and Aeras Global TB Vaccine Foundation, the Rockville, Md.-based non-profit TB vaccine development organization. BCG vaccine prevents some forms of TB in infants, but does not prevent pulmonary TB, which accounts for the majority of infections and deaths among adolescents and adults. A new TB antigen, M72, a fusion protein which is compatible with adjuvant containing Agenus Inc.’s QS-21 Stimulon adjuvant, has been developed by GSK, and found in initial clinical trials to induce an immune response and offer an acceptable safety profile. GSK and Aeras have agreed to each provide resources in order for a Phase IIb clinical study to be conducted in Kenya, India and South Africa next year, in healthy adults aged between 18 and 50. Aeras is supporting the development of half a dozen TB vaccine candidates, the most advanced of which is Oxford University’s MVA85A, a candidate vaccine using a modified vaccinia virus as a vaccine delivery system and two other candidates initially developed by Crucell (now Johnson & Johnson) and Sanofi. Aeras is funded by the Bill & Melinda Gates Foundation and other private foundations and governments. - John Davis

UCB/Harvard University: In the third research collaboration to be set up under an alliance forged in 2011, the Belgian mid-sized pharma UCB is to work with Harvard University researchers on exploiting the human intestinal microbiome for therapeutic molecules. The microbiome comprises the 100 trillion bacteria found in each person’s gastrointestinal tract. These bacteria influence the well-being of individuals and their immune systems, and UCB will provide up to $4.5 million to fund the microbiome-related research of three professors of immunology at Harvard: Christophe Benoist, Dennis Kasper and Diane Mathis. They will systematically mine and classify any new species they find in the microbiome, evaluate the impact of the microbiome on the immune system, and look for new immune-modulating molecules with potential therapeutic applications, UCB announced Oct. 10. Several companies, including VC-backed start-ups, already are looking to exploit the microbiome to develop new therapies. In total, UCB expects to spend $6 million in a multi-year agreement to fund specific research projects at Harvard in the fields of central nervous system disorders and immunology. The first project funded was with Prof. Gokhan Hotamisligil, to identify antibodies against an undisclosed target in metabolic diseases. The second, concluded in June 2012, was with cell biology professor Junying Yuan, who was to develop small molecules which induce autophagy. This is the process in which cells ingest intracellular components and offers potential in the treatment of neurodegenerative diseases. - JD

Sanofi/Massachusetts General Hospital: Sanofi is expanding its presence in the Boston research community through a translational medicine collaboration with Massachusetts General Hospital. MGH will work with Sanofi’s oncology division on two preclinical molecules that were discovered in Sanofi’s labs. The teams will include scientists from both organizations and will be “highly collaborative.” Financial terms of the deal were not disclosed, but it will encompass a two-year period during which the compounds are expected to enter the clinic. The deal terms are flexible enough that other molecules may be added to the collaboration in the future and the timeframe of the collaboration may be extended. The focus of the collaboration will be on translational medicine solutions in oncology. “Sanofi Oncology takes a dedicated and integrated translational medicine approach by understanding the problems that doctors and patients are facing, both from the perspective of a pharmaceutical company and that of a diagnostic company,” said Donald Bergstrom, head of translational and experimental medicine at Sanofi Oncology. Bergstrom added that finding biomarkers will be a key part of the collaboration. The researchers will be focusing on which patient groups will benefit best from the drugs being developed and how to design the clinical program to achieve successful results. - Lisa LaMotta

Roche/Lilly/Washington University: Roche and Eli Lilly will see their investigational drugs tested in a large-scale Alzheimer’s disease trial run by Washington University in St. Louis. Roche’s amyloid beta antibody gantenerumab and Lilly’s solanezumab have been chosen by the university’s School of Medicine for testing in a clinical trial to study if the drugs can prevent the loss of cognitive function in people with inherited mutations that cause early-onset Alzheimer’s disease, the university announced Oct. 10. A third drug, a beta secretase inhibitor also developed by Lilly, is under consideration as well. The trial, expected to begin in early 2013, will be conducted by the university's  Dominantly Inherited Alzheimer’s Network Trials Unit , which is funded in part by NIH, the Alzheimer’s Association, and the DIAN Pharma Consortium composed of 10 pharmaceutical companies. The Roche and Lilly drugs were selected from more than a dozen nominations, with each offering a unique approach to counter the effects of amyloid beta, which builds up in the brains of patients with Alzheimer’s disease. All three drugs have been tested in earlier clinical trials to evaluate safety and efficacy. Gantenerumab is in a Phase III trial testing the drug in early-stage Alzheimer’s patients who have not yet experienced symptoms of dementia. Solanezumab has been making headlines recently; it failed in two high-profile Phase III trials in patients with Alzheimer’s disease, but did show signs of efficacy for slowing cognitive decline in a secondary analysis of pooled data. Roche and Lilly will make the treatments available at no cost and provide supporting grants. The Alzheimer’s Association provided a $4.2 million grant. The trial will enroll 160 people with inherited mutations for Alzheimer’s at a point when they would be within 10 to 15 years of the anticipated age when symptoms of cognitive decline and dementia would appear. An additional 80 participants who did not inherit the mutations also will be monitored. - Jessica Merrill

MedImmune/Cancer Research Institute/Ludwig Institute for Cancer Research: MedImmune, the biologics arm of AstraZeneca, has set up a collaboration with two non-profit research organizations, the Cancer Research Institute and the Ludwig Institute for Cancer Research, to collaborate on clinical trials to test combinations of three novel monoclonal antibodies from MedImmune’s pipeline. The partners also said they are open to including promising non-MedImmune novel compounds in the trials. The agreement, announced Oct. 9, calls for Ludwig and CRI, with input from MedImmune, to conduct the trials using yet-to-be determined combinations of the three compounds, and/or other compounds the partners are working on, or other potential partners might offer up. One of the compounds is tremelimumab, which Pfizer gave up on several years ago and which belongs to the same class as Bristol’s successful melanoma treatment Yervoy (ipilimumab), but MedImmune and its collaborators insist that the problem with tremelimumab was due to the clinical trial design, not the compound itself. CRI’s Cancer Vaccine Acceleration Fund, a two-year-old venture philanthropy group set up to invest in and facilitate innovative cancer immunotherapy trials, is funding the trials. MedImmune is supplying the drugs and, depending on results of the clinical trials, plans to commercialize them and make milestone payments to its backers. The biotech also is continuing to develop the compounds separately, based on its original plans. - Wendy Diller

Picture credit: Nano-structure geometry