Pharmaceutical giant Roche will acquire Good Therapeutics, reeling in its lead program six years after the Seattle startup was founded to design drugs that operate only where needed in the body.
Roche will make an upfront payment of $250 million for the acquisition, focused on a preclinical drug candidate in immuno-oncology. The deal, announced Wednesday morning, comes with the potential for future payments based on development, regulatory, and commercial milestones, and includes rights to develop closely related agents based on the platform.
The 26-employee Good Therapeutics team will remain in Seattle, operating under a newly-formed company, Bonum Therapeutics. (Bonum means ‘good’ in Latin.)
Good Therapeutics has additional programs at earlier stages of development focused on targeted delivery and regulation of other immune modulators, including interferon-alpha and TGF-beta. These programs and the core technology were not transferred to Roche and will continue at Bonum.
The deal is expected to close this quarter, pending approval by antitrust regulators.
Good Therapeutics previously raised $600,000 in Seed funding, $22 million in a Series A round in 2020 and $10 million in a recent Series B round. Roche Venture Fund is an investor.
The startup’s protein therapeutics reversibly switch from inactive to active form when they bind to their target. By controlling where and when a therapeutic is active, the approach can direct the effects to specific cells or tissues and minimize toxicity.
Good’s lead candidate delivers a molecule called IL-2 to T cells that express the immune marker PD-1. IL-2 shifts to an active state when the agent binds PD-1, souping up the anti-tumor response. Roche acquired the exclusive rights to this agent, as well as the right to use the company’s platform technology to develop additional PD-1 regulated IL-2 therapeutics. That program will transfer to Roche’s research and development unit.
IL-2 has a long history as a drug target, as it is known to quell cancer. But the immune modulator is often toxic when administered throughout the body. Drug companies have taken a variety of approaches to minimize the toxic effects of IL-2 and maximize its benefit. Good’s approach provides a unique way to do this.
“Good Therapeutics was founded to create a new class of conditionally active therapeutics that will be more effective and avoid the problem of systemic immune activation seen with previous versions of such drugs,” said Good Therapeutics’ founder and CEO John Mulligan in a statement.
“Roche is a leader in immuno-oncology and has pioneered the field of engineered PD-1-targeted IL-2 therapeutics. Given their expertise in this field and broad capabilities in oncology, we believe they are a perfect choice for taking this important program forward,” added Mulligan, who will remain as Bonum’s CEO.
Good’s previous investors all plan to invest in Bonum Therapeutics, said Mulligan in a blog post. In addition to Roche Venture Fund, other investors are Rivervest, Digitalis Ventures, 3×5 Partners and Codon Capital.
Mulligan previously founded Glycostasis, a company that designed a protein to regulate insulin levels, and co-founded Cambrian Genomics, which created a way to laser print DNA. He also worked as a consultant for Microsoft on a system for storing data on strands of DNA.
In a separate post, Mulligan discussed building a lean biotech company by hiring “contrarians” and following a “no jerks” rule.
The company recently hired Neela Patel as chief business officer and promoted Diane Hollenbaugh to chief scientific officer from head of research. The technology was invented and developed at Good Therapeutics.
