Deals Of The Week: New Remedies Sought From Nature And Old Technologies

To help calm many a frazzled J. P. Morgan attendee trying to get to grips with new ideas, technologies and market entrants announced each year at that key U.S. conference, there’s nothing like a return to tried and tested modalities, particularly in drug discovery.

Two deals announced this week in Europe appear to herald just such a return to basics, although on closer inspection these older drug discovery methods – searching through natural product libraries for active substances -- and the use of high throughput screening -- have never really gone away.

The first Europe-centered agreement, between France’s Sanofi and Germany’s applied research institute, the Fraunhofer Institute for Molecular Biology and Applied Ecology, involves  identifying potential therapeutic substances from natural sources, mainly micro-organisms, to boost the number of antibiotics in development.

It might seem old hat: the venerable old-timer penicillin was isolated from natural sources, for example.  Still, the collaborators are introducing a couple of new twists. They are going to work together, as one team in shared labs on analyzing the genetics of micro-organisms, stimulating them to produce new active substances, and identifying those substances with therapeutic potential. It’s part of Sanofi’s drive to get  closer to cutting-edge science and external collaborators.

A new facility will be built on the Institute’s campus to house the researchers. Cross-pollination between this collaboration and Sanofi’s on-going alliance with venture-backed biotech Warp Drive Bio, which is scouring the genome of soil samples for examples of natural products with therapeutic potential could be possible. Under that 2012 deal the French pharma gets right-of-first-refusal for all candidates stemming from the target area of the biotech’s first genomic search.

The German researchers have a secret weapon: access to Sanofi’s huge (150,000-plus samples) collection of micro-organisms built up by predecessor companies like Hoechst and Synthelabo, as well as by its own labs.  The Fraunhofer Institute, a network or more than 60 research centers mainly based in Germany, with 30% of its funding from the German government and 70% from  industry partners, gains from the deal by being able to exploit Sanofi’s collection for non-medical uses with its own partners. In the crop protection area, for instance, Sanofi could develop compounds that have potential as human or animal medicines.

The lack of new classes of anti-infectives nearing the market has horrified many public health experts, who are concerned by the emergence of bacterial resistance to commonly used agents. Thereis  not a lot left in the locker to treat life-threatening infections. So it’s good news that other companies, such as Roche, have re-energized their research efforts in the field.

The week’s second European deal involves the setting up of a European joint venture called Hit Discovery Constance GmbH to conduct high-throughput screening (HTS) for biotech and academic partners, and to act as a storage and management facility for compound libraries.

HTS has been a disappointment to some; nonetheless it is now commonplace throughout industry and is often used to narrow down the choice of compounds likely to bind to targets, which are then refined through computer-based analysis and other processes.

Hit Discovery Constance is based in facilities in Constance, Germany, that have had a long line of previous owners – most recently Takeda Pharmaceutical Co. Ltd., and before that Nycomed SPA and Altana Pharma GmbH. Three European companies – Germany’s Lead Discovery Center, Italy’s Axxam SRL and Belgium’s Centre for Drug Design and Discovery - have set up the joint venture to run a fully-automated robotic screening system using a library of compounds assembled by the partners. Combined with other novel biochemical, bioassay and HTS technologies developed by the three partners, Hit Discovery Constance will be one of the largest screening hubs worldwide.

The revival of technology previously thought to be a disappointment was also featured in the standout deal that kicked off the J. P. Morgan meeting, between RNAi developer Alnylam Pharmaceuticals Inc. of the U.S. and Sanofi’s biotech unit Genzyme.--John Davis

Now, time to get on with deals on other fronts. In a week that saw far more than its fair share of activities, we've culled some of the highlights, below:

Moderna/Alexion: A number of deals were made and broken within the RNA space during the J.P. Morgan gathering, including Moderna Therapeutics Inc.’s news it landed another major partner for its preclinical messenger RNA technology. Rare disease specialist Alexion Pharmaceuticals Inc. will pay $100 million upfront to purchase 10 product options and is taking a $25 million equity stake in the company. Moderna will use its mRNA platform to discover molecules for rare diseases and then transfer all rights to Alexion, which will handle preclinical and clinical work on the molecules. Moderna will be eligible for clinical-stage and regulatory milestones as well as high-single-digit royalties on any resulting products.

This deal is similar to one Moderna struck with AstraZeneca PLC in March 2013 for the rights to more than 40 cardiovascular assets. The British pharma paid $240 million for the options. In both deals, Moderna will be eligible for undisclosed clinical and regulatory milestones, as well as royalties on any products that result. Moderna’s technology is designed to use messenger RNA to spur the production of therapeutic proteins. A day later, Moderna also announced that it was spinning out a satellite company, Onkaido Therapeutics to focus exclusively on oncology. Moderna is providing Onkaido’s first $20 million in capital.--Lisa Lamotta
Regeneron/Geisinger: Cash-rich Regeneron Pharmaceuticals Inc.’s collaboration with Geisinger Health System on studying genetic determinants of human disease is one of the most ambitious efforts to date by a drug company to systematically apply genomic sequencing to the discovery of new drugs.

The deal is broad and long-ranging, initially signed for five years, but with a horizon that could go out 10 years. Announced on Jan. 13 at the start of the J.P. Morgan meeting, it calls for Regeneron to perform the heavy lifting on sequencing and genotyping and for Geisinger to provide samples collected from its patient volunteers.  From Regeneron’s perspective, correlating genetic variations and human diseases could yield insights about disease and biomarkers leading to development of better drugs. Geisinger, at the same time, is looking for funding for its own research programs and to incorporate genetic advances into clinical care of its patients. Regeneron separately but simultaneously said it was creating a subsidiary, the Regeneron Genetics Center LLC, based at its Tarrytown campus, to pursue both large-scale and family-specific genomics studies.

The research collaboration will seek to sequence a minimum of 100,000 patients who are part of Geisinger, which treats three million people a year.  During the initial five-year collaboration term, the Regeneron Genetics Center will perform sequencing and genotyping to generate de-identified genomic data. The size and scope of the study are meant to allow great precision in identifying and validating the associations between genes and human disease. No money changed hands, but Regeneron will pay Geisinger for its services. Down the road, if drugs or diagnostics come to market, Geisinger will receive small royalties on sales of products.--Wendy Diller

Prosensa/GlaxoSmithKline: For our top “No-Deal of the Week,” GlaxoSmithKline has exited its 2009 collaboration in Duchenne muscular dystrophy (DMD) with Prosensa Holding BV, but the Dutch biotech is determined to continue advancing a portfolio of DMD candidates on its own, at least for now.

Few observers were surprised when GSK decided to terminate the partnership Jan. 13, but Prosensa says it hopes to continue developing drisapersen, a Phase III RNA antisense oligonucleotide exon-skipping compound which failed a Phase III trial last September.

In theory, drisapersen and Prosensa’s other candidates, three of which have reached mid-stage clinical development, address the underlying cause of DMD with exon-skipping technology that restores the expression of dystrophin protein. GSK paid $25 million upfront, with the potential for up to $665 million in milestones, in October 2009 for exclusive worldwide rights to drisapersen, as well as options on three other exon-skipping candidates. Although drisapersen demonstrated efficacy, as measured by improvement in the six-minute walk test (6MWT) in two other placebo-controlled trials, the companies announced Sept. 20 that it failed to meet its primary efficacy endpoint in the Phase III DEMAND III study.

Prosensa CEO Hans Schikan did not specify whether Prosensa paid GSK anything to re-acquire its intellectual property rights, including the options GSK had held, but said the multinational pharma holds no downstream rights for any of the DMD candidates. Prosensa earned at least $28 million in milestones under the collaboration with GSK, but Schikan said that cash was secondary in importance to the role GSK played in advancing drisapersen. “After this collaboration with GSK, and thanks to their commitment, we now have the largest database in DMD,” he said. He noted Prosensa probably never would have been in a position to develop this compound in this way. More than 300 patients have been treated in various clinical trials.

Schikan would not be pinned down on whether Prosensa will seek another co-development partner for drisapersen. The first order of business is to meet with stakeholders to see if there is a regulatory path forward for the compound, he said.--Joseph Haas

McKesson/Celesio: Our other notable “No-Deal” was McKesson Corp.’s announcement Jan. 13 that it had failed to complete the acquisition of Germany-based drug wholesaler Celesio AG because it did not attain the necessary 75% share position through its tender offer, despite raising its bid to €23.50 per share from the original €23. The acquisition was an effort to expand McKesson’s global reach, but the outcome was contingent on acquiring a minimum of 75% of shares on a fully diluted basis. The bid was announced in October.

McKesson CEO John Hammergren raised the topic during the company’s presentation to the J.P. Morgan Healthcare Conference, also on Jan. 13, and said redoing the tender offer was not a possibility. As a result, the failed offer “clearly puts us back to the drawing board in some respects.”

“Although we remain optimistic that we will continue to find ways to add value to our company through capital deployment and continued scale, it's not clear to us that Celesio will be part of that,” he said. However, asked if a joint venture with Celesio might be an option, he observed, “We obviously have been talking to Celesio for some time about various alternatives. I think clearly there is an opportunity for us to venture with them and jointly buy. In the past, we had the view that an acquisition and the complete control of the asset would give us faster and better throughput than a joint venture would, but clearly a joint venture would be an alternative to consider.”--Scott Steinke













 

DOTW: Biogen Puts Offshore Cash to Work

When it comes to corporate tax planning, biopharmas as a group aren’t spectacularly sophisticated. (A few exceptions come to mind, most notably specialty pharma Valeant and Bristol Myers-Squibb, the latter of which upped its game and expects to drop its tax rate to 16% in 2013. That's down from 26% in 2011.)

It’s particularly hard for U.S. biopharmas to do much with offshore cash. That’s unless they buy something outside the U.S. or pay a high tax rate to bring cash into the U.S. Or they can opt to keep stockpiling cash ex-U.S. in hopes a cash- repatriation tax holiday is on the horizon, an unlikely scenario anytime soon given the ongoing fiscal standoff.

This week, Biogen Idec made a bold move by using offshore cash to acquire full rights to multiple sclerosis drug Tysabri (natalizumab) from its previously 50/50 partner Elan. The deal manages to turn cash sitting on its balance sheet, much of it offshore, almost immediately into a bump for EPS and cash flow - a neat trick. Deutsche Bank analyst Robyn Karnauskas upped her 2013 EPS estimate to $7.76 from $7.15 and her 2013 revenue estimate to $6.6 billion from $6.1 billion. She expects the new structure to be in place in the second quarter.

The deal includes a $3.25 billion upfront payment from Biogen to Ireland-based Elan. Most of this will come from offshore cash, Biogen CFO and EVP Paul Clancy said on a Feb. 6 call. Biogen Idec had $3.7 billion in cash at Dec. 31. In addition, Elan will receive 12% of Tysabri sales in the first year and then after that 18% on sales under $2 billion and 25% on sales over $2 billion. Tysabri had 2012 sales of $1.6 billion, with some analysts modelling peak annual sales well above $2 billion.

Biogen CEO George Scangos made reviving Tysabri revenue growth a priority when he began his tenure in June 2010. After a 2004 approval, Tysabri was withdrawn from the market in 2006 due to reports of the fatal brain disease, progressive multifocal leukoencephalopathy (PML). It re-entered the market in 2006 with a label for second-line use and a boxed warning. Scangos pushed for the development and approval of a test for JCV antibodies to assess PML risk. In January 2012, FDA updated the Tysabri label on include information quantifying the risks of developing PML according to JCV antibody status. Last month, the partners submitted applications to FDA and EMA for first-line use of Tysabri in patients who test negative for antibodies to the JC virus.

Wall Street initially was wildly enthusiastic about Biogen’s move, spiking shares up 6% in early trading Feb. 6. But since then, the Street has become a bit more cautious, with the gain retreating to about 2% by market close on Feb. 7. Skeptics worry Tysabri won’t live up to revenue expectations or that Biogen’s execution of this deal just ahead of the March 28 PDUFA date for the oral MS drug formerly known as BG-12, now called Tecfidera (dimethyl fumarate), indicates reduced optimism for the new treatment. On the Elan side, buysiders worry about whether President and CEO Kelly Martin will use that mountain of cash to make useful deals. The company doesn’t have the best track record when it comes to strategic transactions. Elan shares were off 6% by the end of Feb. 7 on the deal.

Biogen Idec is hardly alone among biopharmas in having stacks of offshore cash. At the end of 2011, biopharma companies had a  total of $183 billion in cash most of which was offshore, according to a March report from Moody’s. To put that in some context, that is roughly equal to the combined market caps of Amgen, Gilead Sciences and Bristol. Biopharma is second only to the technology industry when it comes to the sheer amount of cash on the books. Last week, the IT sector also offered an instructive example with the privatization of Dell, which itself could be a partial end-run around offshore cash and corporate taxation issues.

The top biopharma cash hoarders in 2011 were Pfizer ($35.3 billion); Johnson & Johnson ($32.3 billion); Amgen ($20.6 billion); Merck ($18 billion) and Bristol ($11.6 billion). Now that the immediate panic of patent cliffs is behind many of them, perhaps biopharmas will take a breather, look around and think of more creative, tax-efficient ways to deploy all that cash.

For a look the rest of the money that was spent in this week's biopharma deal activity, you need go no further than this week's edition of . . .

Alnylam/The Medicines Co. Hospital specialist The Medicines Co. is jumping into the PCSK9 race for the treatment of high cholesterol in a partnership with RNAi therapeutics developer Alnylam Pharmaceuticals, announced Feb. 4. But the program is far behind other PCSK9 drugs in development at Sanofi/Regeneron and Amgen, which are both in Phase III development. The product, which has completed Phase I testing, will have to prove itself to be differentiated from the leaders if it is to become an eventual commercial success. Alnylam and TMC don’t think that’s a problem because as an RNAi therapeutic ALN-PCS works through a different mechanism of action than the leading drugs in development, which are monoclonal antibodies. That could yield a best-in-class drug, the companies predict, although the results will have to bear out in clinical studies. Alnylam will be responsible for developing the programs further for an estimated one to two years to complete preclinical and Phase I clinical studies of the subcutaneous formulation, and TMC will be responsible for leading and funding development from Phase II forward and for commercializing the program if successful. TMC will pay $25 million upfront and Alnylam stands to receive potential development and commercial milestone payments of up to $180 million and could earn scaled double-digit royalties on sales of the resulting products. It’s not an enormous value for an asset that hits such a hot target. Alnylam Chief Business Officer Laurence Reid admitted the upfront portion of the deal reflects the competitive dynamics in the PCSK9 field and the fact that there are several drugs in later stages of development. - Jessica Merrill

Inspiration/Cangene: French company Ipsen is finally free of U.S. partner Inspiration Biopharmaceuticals. Cangene has agreed to buy rights to IB1001, a recombinant factor IX (rFIX) for the treatment of hemophilia B, which FDA put on clinical hold in 2012. The deal, announced Feb. 6, completes the sale process of all Ipsen and Inspiration hemophilia assets and follows the Jan. 24 news that Baxter would buy the troubled biotech’s flagship hemophilia drug OBI-1 and related Boston manufacturing facility. Inspiration entered Chapter 11 protection at the end of October 2012 to restructure and find a buyer for its two main hemophilia products: OBI-1, a recombinant porcine factor VIII (rpFVIII) for treating hemophilia A with inhibitors, and IB1001. In return for global rights to IB1001, Cangene agreed to pay $5.9 million upfront and up to $50 million in potential additional commercial milestones, as well as net sales payments equivalent to a tiered double-digit percentage of IB1001 annual net sales. Meanwhile Baxter, in its transaction pact for OBI-1, will pay $50 million upfront, up to $135 million in potential additional development and commercial milestones as well as tiered net sales payments ranging from 12.5% to 17.5% of OBI-1 annual net sales. As Inspiration's only senior secured creditor and as the owner of non-Inspiration assets that will be included in the sale of both OBI-1 and IB1001, Ipsen will get some 60% of the overall upfront payments. Ipsen is clearly relieved to have found a buyer for IB1001 given the medicine’s shaky regulatory prospects after the FDA-imposed clinical hold on IB1001 impacted two ongoing phase III trials. Since Inspiration filed for bankruptcy protection, Ipsen has backed the biotech with $23.6 million in debtor-in-possession (DIP) financing to keep it going amid efforts to sell its assets. Ipsen expects to cover the DIP amount with its share of upfront payments from the two asset sales with Baxter and Cangene. The French biotech may take a €100 million impairment charge for the hemophilia assets such as convertible bonds used to finance the collaboration and its investment in the Milford, MA plant. A fuller picture should come on Feb. 27 when Ipsen reports 2012 earnings. - Sten Stovall

Pfizer/OxOnc: Drug-development group OxOnc, which is funded by health care hedge fund OrbiMed Advisors, signed a deal with Pfizer to co-develop Xalkori (crizotinib) in a pivotal clinical trial intended to enable the approval of the drug in Asian countries in a new indication. Xalkori is already approved in the U.S., EU, Japan and other countries to treat patients with ALK-positive advanced non-small cell lung cancer (NSCLC). This trial would be in ROS1-positive advanced NSCLC patients. The trial will be at multiple sites in Japan, China, Taiwan and South Korea. OxOnc will be eligible to receive undisclosed milestones if Xalkori is approved in this indication. No further details were disclosed. - Stacy Lawrence

Isotechnika /Aurinia: Isotechnika licensed out exclusive rights a year ago to its lead drug in a couple of indications and now it’s planning a merger to get it back. Last January, the Canadian company licensed rights to voclosporin to treat lupus and proteinuric nephrology indications to Vifor Pharma. Swiss specialty pharma Vifor subsequently spun out Aurinia with the asset. Isotechnika and Aurinia now are planning to merge under undisclosed terms with post-merger ownership of 60/40, respectively. The merged company will trade on the Toronto Stock Exchange and be known as Aurinia. Management will come from both companies. Aurinia’s management is primarily from Aspreva Pharmaceuticals, which was acquired by the Galenica Group for C$915 million in 2008. Vifor is also part of the Galenica Group. The merger is expected to complete by March 15, pending approval from Isotechnika shareholders and the Toronto Stock Exchange as well as the raising of C$3 million by Isotechnika. The new company plans to start a Phase IIb study this year of voclosporin, in addition to standard of care, to treat lupus nephritis. - S.L.

Stacks of Euros photo courtesy of flickr user aranjuez1404. 

Financings of the Fortnight Tells A Tale of Two Conferences

Investors gauging the market mood look for signs. We also spent two days this week at the BioInvestor Forum in San Francisco looking for signs that the current biotech climate is anything but a bummer.

No dice. Everyone we spoke with thought attendance felt light; the show runners at BIO countered that registration was up 5% over last year then blamed the first day's obvious loneliness on traffic snarls caused by President Obama's visit to San Francisco. Most of the company presentations we attended had fewer than 10 people in the room, and that included the company's PR rep and the guy or gal running the A/V gear. On the second day, organizers cut the main room in half to make the panel discussions feel more intimate.

The biggest sign of malaise was the title of the final panel: "Opportunities or Apocalypse? Prophecies for 2012." To even contemplate the A-word in what's supposed to be an industry-boosting event was a sign of how sour the mood is right now. Still, Matthew Perry of Biotechnology Value Fund, Bryan Roberts of Venrock, Kurt Von Emster of VenBio, and Ron Laufer of MedImmune Ventures did their level best to buck everyone up. Perry prophesied con mucho gusto that old-school biotech companies, built on groundbreaking science, will start going public in the next 12 to 18 months before even having late-stage clinical data.

While the word "apocalypse" literally hung over everyone's head the entire time on the projection screen, an exit sign glowed over Roberts' right shoulder. No one on stage seemed to notice. How's that for symbolism?

Another sign of the "new normal" of the decreased influence of traditional venture capital: big drug makers aren't just being more aggressive with their own in-house venture arms, they're also thinking hard about deploying capital as limited partners to back venture groups struggling to raise money during the Great Shakeout. Both Merck & Co. and Eli Lilly have taken steps to invest in early stage science via the LP route: Merck through its Merck Research Venture Fund, which our industrious colleagues were first to report here, and Lilly via its Mirror fund initiative, which has encountered some speed bumps.

On another panel, the topic was not building companies but asset financing -- moving drugs forward in the most efficient manner possible and into the hands of the strategic buyers who need to refill pipelines. While David Collier of CMEA Capital was on stage discussing his firm's asset-financing plans through a CMEA-funded vehicle called Velocity Development Corp., another venture firm across the country made good on a similar plan. Atlas Venture unveiled its first asset-based limited-liability corporation, Arteaus Therapeutics, which we detail below.

An antidote to the subdued investment scene was a short walk away (or a cable car ride, if you prefer). In a Nob Hill hotel conference room, the World ADC Summit brought a packed house of mainly scientists together for talks on antibody-drug conjugates, a field that needed three decades to produce an exciting commercial product: Seattle Genetics' Adcetris (brentuximab vedotin), which received FDA approval in August. We're not counting Mylotarg (gemtuzumab ozogamicin), which Wyeth had approved in 2000 but never caught on and was removed from the market in 2010 for safety concerns.

The mood at the ADC Summit was palpably different: an acknowledgment that the door is wide open to a vast array of technological advancements, some of which could be quite disruptive and are being driven by small venture-backed firms. One of those firms was Syntarga, with drug-and-linker technology, that agreed to be acquired in June by its Dutch neighbors Synthon; former Syntarga CEO Vincent de Groot, now a vice president at Synthon, told IN VIVO Blog that ADC innovation will come "from all angles," and what's now known is only the visible part of a technological iceberg. Seattle Genetics, Immunogen and Genentech will need to continue to innovate to ensure their tenure as ADC leaders isn't short-lived -- not that those companies are standing pat. (For more background on the rising ADC tide, have a look at our story from December.)

To be fair, BioInvestor also had a lively panel discussion dedicated to ADCs peopled with executives from some of those small firms. But the ADC Summit in particular was a reminder that there is plenty of enthusiasm to create biomedical innovation (yes, among the Big Pharma, too). The enthusiasm to open one's wallet to fund such innovation, however, is quite a different story.

A quick note: If there's a topic you'd like to see in this column, or you have specific feedback that you'd rather not put in Web comments for all to see, drop us a line at capitalmatters@elsevier.com or a.lash@elsevier.com. Make sure to include FOTF in the subject line. Your support helps nourish clinical development of subject-verb conjugation that addresses unmet syntactical need every two weeks in...



Arteaus Therapeutics: Earlier this year, Atlas Venture said it would explore a new asset-based funding model, yet another experiment by a venture firm in an effort to improve returns from early-stage products. Its first such investment appeared Oct. 19 with the launch of Arteaus Therapeutics, a company without employees created solely to house a Phase I migraine drug spun out of Eli Lilly & Co. Atlas and OrbiMed Advisors provided $18 million in Series A funding to Arteaus, a start-up designed to be even more virtual than most virtual companies. It will be structured as a limited liability corporation (LLC) and will be controlled primarily by Atlas Venture Development Corp., a stand-alone offshoot of Atlas intended to direct operations at several companies like Arteaus simultaneously. Atlas partner and acting Arteaus CEO Dave Grayzel said the cash will fund clinical trials to show proof of concept rapidly; if that’s achieved, Lilly holds an option to reacquire the asset at undisclosed pre-negotiated terms, and therefore deliver an exit for Atlas and OrbiMed. A bit of irony: Lilly has been working to build exactly this type of relationship with three venture funds in what it calls the"Mirror" portfolio. Those plans have not gone quite as expected, with at least one fund, CMEA Capital, not participating. (Lilly said in early 2011 that one of its venture partners had accepted two molecules, one from Lilly and one from a third party.) Atlas is not one of the Lilly "Mirror" funds. The molecule, an antibody being studied as a prophylaxis for migraines, binds with calcitonin gene-related peptide (CGRP); both Merck and Boehringer Ingelheim have halted development of CGRP antagonists designed to treat acute migraines. -- Paul Bonanos

Regeneron Pharmaceuticals: It's every little biotech's dream: sign several platform-validating licensing deals, save a few choice molecules (or regions, or indications) for itself, bring a drug to market that could put a lickin' to one of the big boys, then borrow a barrelful of non-dilutive cash for the commercial war chest. Regeneron hasn't yet shown that its wet age-related macular degeneration treatment Eylea (aflibercept) can beat Genentech/Roche's Lucentis; in fact, thanks to a three-month PDUFA delay, it must wait until Nov. 18 for approval. But it's got the cash for the battle. Regeneron announced October 18 it raised $400 million in convertible debt, payable over five years at 1.875%. As commercial chief Bob Terifay told IN VIVO this summer as part of an analysis of biotechs that manage to bring a first drug to market, the firm is shifting significant resources to the commercial side for the first time. Eylea would actually be Regeneron's second approved drug; its first, Arcalyst(rilonacept), treats a family of ultra-rare diseases and requires scant commercial outlay. Eylea sailed through its FDA advisory committee meeting and is still expected to win approval. If Regeneron can convince doctors and payors of Eylea's benefits (fewer injections, for example) it could take market share from Lucentis, the proper use and price of which has been thrown into question by the CATT study. Bayer HealthCare has rights to Eylea ex-U.S. -- Alex Lash

SAGE Therapeutics: Third RockVentures is one of the few VCs willing to make big bets on early stage science these days. With the announcement on October 18 of its solo staking of SAGE, a Boston start-up developing novel medicines for schizophrenia, depression, and other CNS conditions, the investment group makes its first major bet in neuroscience. It’s a move that’s been expected since October 2010 when Steven Paul, former EVP of Lilly Research Laboratories and a neuroscientist by training, joined Third Rock Ventures as a venture partner. Underpinning SAGE is a proprietary chemistry platform called PANAM, referring to the start-up's intent to develop positive and negative allosteric modulators of GABA and NMDA receptors. Both proteins are critical actors that respectively play a role in the transmission of the inhibitory and excitatory neurotransmitters, gamma-aminobutyric acid and glutamate. Third Rock has been incubating the company for more than a year, building its IP position and an advisory board of top-notch academics. "It will be hard for anyone else to mimic this approach given what we've consolidated over the last year," interim CEO Kevin Starr(and a Third Rock partner) told “ThePink Sheet” DAILY. Both Starr and Paul said the $35 million Series A, which may or may not be tranched, is enough to take four or five programs forward simultaneously. One of those seems likely to be a positive allosteric modulator for schizophrenia that has “encouraging” data, according to Paul. Interestingly,one family of targets SAGE won't be pursuing is the metabotropic glutamatereceptor (mGluR) family, among the hottest targets of interest inside many big pharmas and biotechs, including Lilly, Johnson&Johnson, and Addex Pharmaceuticals. –- Ellen Foster Licking

BIND Biosciences/Selecta Biosciences: These two Boston-area nano-medicine companies already have much in common: both were co-founded by Massachusetts Institute of Technology professor Robert Langer and Harvard Medical School professor Omid Farokhzad, and both feature Flagship Ventures as an original investor. But they're now connected in another way: simultaneous investments by Rusnano, the Russian state fund for nanotechnology run by former Russian politician Anatoly Chubais, who ran the privatization process under Boris Yeltsin. Announced Oct. 27, Rusnano is investing $25 million in each company, making it the largest investor in rounds totaling $47.5 million for each company, with new and existing investors filling out the slate. Both BIND and Selecta will open subsidiaries in Russia to tap into scientific talent as well as clinical trial populations. Both firms have advanced a lead candidate from their platforms. Selecta, with its Synthetic Vaccine Particle platform, is just now entering the clinic with its program for smoking cessation. BIND, whose Accurin platform aims to accumulate systemic cytotoxins in higher, more targeted concentrations, is in Phase I with its lead progam BIND-014, a reformulated version of the chemotherapy docetaxel, aimed at advanced or metastatic solid tumors. -- A.L.