ADVERTISEMENT

Takeda Makes Bet on Viral Cancer-Killers in Deal With Turnstone

Takeda Makes Bet on Viral Cancer-Killers in Deal With Turnstone

(Bloomberg) -- Takeda Pharmaceutical Co. is joining the search for a viral treatment that can hunt down and kill cancer cells, in a deal with closely held startup Turnstone Biologics Inc.

The Tokyo-based drugmaker is paying Turnstone $120 million upfront with added potential payments of as much as $900 million for access to Turnstone’s lead drug candidate, Rival-01. The virus-based therapy works by infiltrating tumor cells and eventually stimulating an immune response.

The deal comes as large pharmaceutical companies around the globe are pouring money into potential cancer treatments, a market expected to reach $230 billion by 2024.

Turnstone isn’t the only company working on the cancer fighters known as oncolytic viruses. Merck & Co. bought Australia’s Viralytics Ltd. for more than $400 million last year. Amgen Inc. brought the first oncolytic treatment to the market, but it has had disappointing sales as the medicine showed little effect on extending survival of patients with the deadly skin-cancer melanoma.

But Turnstone’s platform is different. Sammy Farah, the startup’s chief executive, said it can be used to deliver other medicines directly to a tumor as they can be coded into the virus’ genome and be used as a production factory for a therapy. Rival-01 hasn’t yet been tested in humans.

As Takeda looks to bolster its cancer-therapy pipeline, the drugmaker has been building new partnerships and moving away from being an “inward facing to a truly outward-facing research team engaged in looking for world-class partners,” said Chris Arendt, head of Takeda’s oncology drug discovery unit.

Turnstone’s platform offers an opportunity to harness the power of multiple immuno-oncology agents and send them directly into solid tumors.

“When we have a whole portfolio of immune-modulating agents that require the ability to act in a solid tumor and when that environment is incredibly hostile, there’s a chance those agents will work poorly,” Arendt said. “The oncolytic virus is the first piece of that paradigm to unlock the door to a solid tumor.”

The virus proliferates inside the tumor and aids in breaking tumor cells apart and at some point awakens immunity.

The Japanese drugmaker also has been shedding assets as it seeks to pay down a mountain of debt from its $62 billion acquisition of Shire Plc and to zero in on key focus areas, including oncology and rare diseases.

The two companies plan to split costs and profits and seek to develop other new cancer medicines. Takeda will also get a stake of undisclosed size in Turnstone, which has headquarters in New York and Ottawa. The startup, which is valued around $200 million, according to PrivCo data, has also received financial backing from Versant Ventures, OrbiMed, F-Prime Capital Partners.

To contact the reporter on this story: Cristin Flanagan in New York at cflanagan1@bloomberg.net

To contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Mark Schoifet, Timothy Annett

©2019 Bloomberg L.P.