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Warp Drive 'Puts' Natural Spin on Drug Discovery

bwt04092012 Warp Drive

By Trista Morrison
Staff Writer

When Warp Drive Bio LLC emerged on the biotech scene earlier this year, the start-up's unique business model, jointly backed by Third Rock Ventures LLC and Sanofi SA, garnered plenty of buzz. But equally innovative, if not equally attention-getting, is the Cambridge, Mass.-based biotech's take on drug discovery.

"Our fundamental mission is reimagining natural product drug discovery," Warp Drive interim CEO Alexis Borisy told BioWorld Today.

Natural products – abandoned for decades as researchers focused on high-throughput screening and rational drug design – are suddenly returning to prominence in drug discovery circles. This "back-to-basics" mentality is perhaps less surprising than it might initially seem, given that improvements in drug discovery technology have largely failed to improve productivity. (See BioWorld Insight, March 19, 2012.)

"Natural products have created more drugs today than any other source," Borisy said. Examples include Taxol (paclitaxel) and aspirin, which are synthetic versions of compounds originally derived from the yew tree and the willow tree, respectively. Gilenya (fingolimod, Novartis AG) was derived from a fungus that lives on a silk worm. The list goes on and on – prompting Borisy to conclude that "nature is a superior medicinal chemist."

But natural products are not easy to work with, Borisy explained – they require lots of screening, purifying, characterization, synthesis and manufacturing work. Thus, many big pharmas trended away from the space.

They are now coming back. GlaxoSmithKline plc created a Discovery Performance Unit in China dedicated to researching how traditional Chinese medicines could be converted into synthetic drugs. And Borisy said that when Third Rock began to explore its concept for creating Warp Drive within big pharma circles, it received a very positive reception.

Warp Drive is the brainchild of Gregory Verdine, director of the Chemical Biology Initiative at the Dana-Farber Cancer Institute and professor of chemistry at Harvard University. In 2009, he began talking to Third Rock about how to apply modern drug discovery techniques to natural sources. Essentially, the concept was to take existing technologies and combine them in a new way, focusing on a new source, to find molecules that could hit targets previously considered undruggable.

Borisy described Warp Drive's platform as "reading, writing and arithmetic." The reading part involves sequencing microbes and using bioinformatics and chemoinformatics to figure out what proteins and molecules that sequence will make. The writing step takes the molecules "from the digital world to the physical world," Borisy explained, configuring and producing sufficient quantities of the product. The arithmetic piece then uses proteomics to confirm the mechanism of action and characterize the drug's effects.

Borisy noted that the way Warp Drive has combined those technologies creates a "unique capability in the industry." The start-up also has a proprietary genomic search engine, which involves querying for DNA sequences within bacterial genomes.

While many companies exploring natural product chemistry are focused on plants, Borisy said Warp Drive chose to focus on microbes because "they are the dominant life form on this planet." He added that microbes are genomically organized in a way that makes them accessible to Warp Drive's techniques, and that microbes have been the source of many approved drugs including antibiotics like Vancocin (vancomycin, ViroPharma Inc.) and transplant drug Rapamune (sirolimus, Pfizer Inc.).

At this stage, Warp Drive is still what Borisy calls a "blue sky" biotech – big picture, conceptual, with a lot of work ahead. But that didn't stop big pharma from taking interest when Third Rock started to put out feelers for a partner in 2011.

With Sanofi, there was "clearly a meeting of the minds in terms of scientific vision," Borisy explained. Both parties realized Warp Drive needed time and resources to turn its vision into reality, and they came up with a unique business model to support the start-up.

Sanofi, Third Rock and venture firm Greylock Partners came together to provide Warp Drive with $75 million in equity. Sanofi also kicked in an additional $50 million in nonequity investment, although Borisy declined to provide details as to whether that takes the form of research funding or milestone payments or something else altogether.

Warp Drive is independent from Sanofi, but it has a collaboration with the big pharma, the focus of which has not been disclosed. Outside of that collaboration, Warp Drive is free to form other partnerships with other pharma or biotech players.

The most interesting aspect of the deal is that the company has a put option that can force an acquisition by Sanofi, if certain milestones are met. The predetermined price of that acquisition could be "north of $1 billion," Borisy said, depending on what's accomplished. And the put option only covers the assets under the collaboration with Sanofi – any other assets could be sold or spun-out prior to the acquisition. If Warp Drive shareholders decide not to put the firm to Sanofi, the big pharma may choose later to exercise a call option on an acquisition.

Borisy said he gives "enormous credit" to Sanofi for resisting the big pharma urge to control everything and for recognizing the power of aligning incentives.

The put option gives Warp Drive's founders and employees five years of runway to see if their ideas pan out; it gives Sanofi the opportunity to tap a high-risk research program without building internal infrastructure and amassing fixed costs; and it gives the venture investors assurance that if Warp Drive achieves its goals, they'll get "a fantastic venture return."