December 9, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Frankfurt, Germany-based Bayer AG and San Francisco and New York-based Versant Ventures have formed BlueRock Therapeutics with joint funding of $225 million. BlueRock will focus on stem cell research to regenerate heart muscles after a heart attack, and to develop therapies for Parkinson’s disease.
A formal announcement is expected on Monday.
“We at Bayer were not so familiar with these new technologies,” said Axel Bouchon, the head of Bayer’s Life Science Center, to MarketWatch, “and needed a different spirit to really drive them to maturity.”
To date, BlueRock has licensed intellectual property regarding foundational stem cells from a Nobel Prize winning scientist at Kyoto University. Although not specifically stated yet, it’s probably Sinya Yamanaka, who won the Nobel Prize with John Gurdon in 2012 for Physiology or Medicine for work that discovered that mature cells could be converted to stem cells. BlueRock has started to pull together a team of researchers via partnerships with McEwen Center for Regenerative Medicine in Toronto, and Memorial Sloan Kettering in New York. BlueRock will be located in Toronto, New York and Boston.
BlueRock expects to hire more than 50 people within the next 18 months.
In 2015, Bayer Life Science Center established a joint venture with CRISPR Therapeutics AG, which was co-founded by Versant. That deal is designed to utilize CRISPR/Cas9 gene editing technology to develop therapeutics for hemophilia, heart disease in infants, and a type of blindness called Stargardt.
There have been a number of high-profile collaborations recently, where large pharma companies partner with external investors and then outsource the research and development to smaller biotech companies and academic institutions. Those companies have included Sanofi , Johnson & Johnson and GlaxoSmithKline . None of them are nearly as large as this deal, however.
“It’s a monster,” said Nooman Haque, director of healthcare and life sciences at Silicon Valley Bank’s UK branch, to MarketWatch. He notes that more typical funding for biotech companies is $10 to $20 million.
One similar deal is Summit, NJ-based Celgene , which is acquiring Boston-based Acetylon Pharmaceuticals. Before that deal is closed, Acetylon plans to spin off some of its pipeline into a new company, Regenacy Pharmaceuticals.
Versant has experience in biopharma collaborations. “More and more pharmaceutical companies have been approaching us to do these kind of projects,” said Bradley Bolzon, Versant’s managing director, in a statement. He indicated Versant had partnered with other pharmaceutical companies in the areas of cell therapy and gene therapy.
On November 2, Versant announced that its portfolio company, Turnstone Biologics, completed a $41.4 million (US) Series B financing for the Canadian biotech company. Versant led its Series A financing less than a year ago.
In October 2015, Versant co-led a Series A financing of $102 million with The Column Group, with Clarus Ventures, of Gritstone Oncology. Additional investors included Frazier Healthcare Partners, Redmile Group, Casdin Capital, and Transformational Healthcare Opportunity.
In 2014, Bayer HealthCare invested up to $25 million in Versant Ventures’ then newly-formed Versant Venture Capital V fund. The fund was developed to create support for new therapies in areas of high unmet medical need. Bayer was to lend technical expertise, but Versant’s team would “maintain full decision-making rights” where portfolio company investments were concerned.
