Massachusetts' Selecta Wrangles $890 Million+ R&D Deal Out of Spark Therapeutics

Published: Dec 05, 2016

Massachusetts' Selecta Wrangles $890 Million+ R&D Deal Out of Spark Therapeutics December 5, 2016
By Alex Keown, Breaking News Staff

WATERTOWN, Mass. – Gene therapy company Spark Therapeutics struck a deal worth up to $890 million with Selecta BioSciences for rights to that company’s Synthetic Vaccine Particles (SVP) platform technology. The deal caused shares of Selecta up more than 13 percent this morning, trading at $22.30 as of 9:56 a.m.

The technology is used for co-administration with gene therapy targets, including FVIII for hemophilia A. Spark also took out options for up to four additional undisclosed genetic targets, Selecta said this morning in a statement. Selecta’s SVP technology is an investigational technology intended to suppress the formation of neutralizing antibodies to an adeno-associated virus (AAV) capsid when used in combination with gene therapies, without altering the therapeutic profile of the gene therapy. Neutralizing antibodies form in response to an initial administration of an AAV gene therapy and prevent effective subsequent usage. The potential ability to re-dose a gene therapy may be beneficial where a patient has not achieved a sufficient therapeutic expression of the transferred gene in the initial dose, the company said.

Jeffrey Marrazzo, chief executive officer of Spark Therapeutics, said if successful, “the co-administration of Selecta’s technology with a gene therapy may enable repeat dosing of AAV gene therapies in both adults and pediatric patients, potentially minimizing the risk of a T-cell immune response to the capsid.”

Werner Cautreels, president, CEO and chairman of Selecta, said the licensing agreement with Spark Therapeutics will accelerate the application of the company’s SVP platform in gene therapy. He said preclinical studies with the SVP platform using the company’s experimental SEL-212 for the treatment of gout, may “greatly benefit patients with life-threatening diseases who currently lack adequate treatment options due to the occurrence of undesired immune responses.”

Under terms of the agreement, Spark will provide an initial $10 million cash payment and purchase $5 million in Selecta stock. Within the 12 months following the signing of the agreement, Spark will pay Selecta an additional $5 million in cash and acquire $10 million in common stock. Additionally, Selecta will be eligible for up to $430 million in milestone payments for each target, with up to $65 million being based on Spark Therapeutics’ achievement of specified development and regulatory milestones and up to $365 million for specified commercial milestones. Spark also agreed to pay Selecta tiered mid-single to low-double-digit royalties on sales resulting from commercialized gene therapies.

Spark said the agreement with Selecta does not apply to the company’s ongoing investigational development programs in inherited retinal diseases (IRDs), including voretigene neparvovec for the treatment of RPE65-mediated IRD and SPK-7001 for choroideremia. Additionally, Spark said the agreement will not impact the co-development deal with Pfizer for the Phase I/II trial of SPK-9001 in hemophilia B of the planned Phase I/II trial of SPK-8011 in hemophilia A.

While Selecta has licensed its SVP technology, the company will continue its own proprietary gene therapy programs with the platform. Selecta has obtained an exclusive license from Massachusetts Eye and Ear to Anc80, an in silico-designed gene therapy vector, for Methylmalonic Acidemia and has options for additional pre-defined indications. Additionally, Selecta is advancing a proprietary gene therapy program for Ornithine Transcarbamylase Deficiency.

Since its IPO earlier this year, Spark’s has grown by about 20 percent, hitting a high of $79.50 per share. It’s currently trading at $52.48 per share.

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