Constellation Pharmaceuticals, a US-based molecular therapeutics company, signed a strategic agreement worth $95m with Genentech, a subsidiary of the Roche pharmaceutical conglomerate, on Tuesday.
Genentech and Constellation plan to launch a collaborative partnership based on Constellation’s epigenetics science, which will lead to treatments being developed to combat cancer and other serious diseases. Genentech also has the option to acquire all outstanding shares in Constellation, should it choose to do so in future.
The funding will be made up of an upfront payment followed by research financing over a three year period. Additionally, Constellation will be in line for milestone payments as well as double digit royalties on a range of Genentech products developed from the collaboration.
Prior to the deal, Constellation had raised a total of $69m from SR One, the corporate venturing fund operated by pharmaceutical conglomerate GlaxoSmithKline, as well as venture capital (VC) firms Venrock and the Column Group, VC fund Third Rock Ventures, and Altitude Life Science Ventures, one of the growth funds representing the Southern Ute Indian Tribe.
Consellation’s research is focused on epigenetics – the study of how genetic marks cause genes express themselves when passed down the generations – to develop medical treatments that work by manipulating proteins to ‘switch on or off’ the genes being affected by various diseases and restore them to normal expression.
Mark A. Goldsmith, chief executive officer of Constellation Pharmaceuticals, said: "This is a groundbreaking partnership in terms of the structure, breadth and potential future clinical impact of products created through our complementary capabilities. The committed revenue and post-collaboration economics should provide a highly attractive return for our investors."
Founded in 1976, Genentech lays claim to being the world’s first biotechnology company, using DNA cloning techniques to construct medical treatments, before being acquired by Roche for $46.8bn in 2009. The two firms merged their pharmaceutical departments at the time of the acquisition.
James Sabry, vice president of Genentech Partnering, said: "We believe Constellation is a leading company in chromatin biology and epigenetics drug discovery and an excellent partner for Genentech in this area. With scientists committed to the collaboration at both Constellation and Genentech working together in a highly integrated way, our goal is to discover and ultimately bring to market promising new therapies for patients with unmet medical needs in oncology, and potentially other therapeutic areas."