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By Donna Young
Washington Editor
Paris-based Sanofi-Aventis Group is buying cancer drugmaker BiPar Sciences Inc. in a deal potentially worth $500 million for the Brisbane, Calif.-based firm and its investors.
The purchase price is tied to the achievement of certain developmental milestones related to BiPar's poly-ADP-ribose polymerase (PARP) inhibitor BSI-201, which prevents cancer cells from repairing their own DNA, leading to apoptosis, or cell death.
BiPar Chief Financial Officer John Schembri insisted that the transaction is not a "biobucks deal," where the ultimate cash payment is much lower than the amount promoted because of failures to reach all of the milestones under agreements.
But BiPar's deal with Sanofi is "really more of what we believe is a tangible deal," because it will "pay out close to the full amount of the deal," he told BioWorld Today.
BiPar chose to do the transaction with Sanofi because of the Paris firm's expertise and experience in the oncology space, with successful drugs like Taxotere (docetaxel) and Eloxatin (oxalplatin), Schembri said.
"BiPar shareholders were excited to partner with Sanofi knowing that they would be one of the best partners to help advance and take the development program forward," he said. In addition, Schembri said, BiPar was "motivated" by Sanofi's "enthusiasm" for its PARP program, which he said was a "big factor in the decision to go with them."
CEO Hoyoung Huh said the agreement validates BiPar's novel scientific approach.
In addition, he said, the acquisition would also "maximize patient access to this new class of breakthrough cancer therapy."
Sanofi spokesman Jean-Marc Podvin noted that BiPar is a leader in the PARP inhibitor space, which he said was what attracted his company to the U.S. firm.
In addition, he told BioWorld Today, the BiPar deal also helps fulfill Sanofi's plan announced in February of broadening and strengthening its platforms through outside acquisitions.
"We are trying to find the science where it is," Podvin said by phone from Paris.
Sanofi earlier this month bought Brazilian firm Medley SA and Mexican company Laboratorios Kendrick in two separate deals, he noted.
Schembri said his company will be working jointly with Sanofi to develop a transition plan for the "right structure" for BiPar moving forward after the deal closes, which is expected to occur in the second quarter, subject to clearance by the Federal Trade Commission. He said BiPar expects and intends that the PARP program will be run by the firm's development team in California.
The structure of the transaction is an all-cash deal, with an undisclosed up-front payment due on closing and developmental-related milestones, Schembri noted.
The maximum amount Sanofi is paying under the deal is $500 million, Podvin said.
In addition to BSI-201, BiPar has two preclinical products in development: BSI-401, a follow-on PARP inhibitor candidate being investigated as an oral therapy for pancreatic cancer, and BSI-302, a antitubulin agent that targets cancer cells based on the role of thyroid hormones in cell proliferation and death.
However, Schembri said, most of the value of the transaction with Sanofi is tied to BSI-201, which is in Phase II development in metastatic triple negative breast cancer (TNBC), a form of the disease that has a negative presence of estrogen, progesterone and HER2 receptors.
TNBC, which accounts for 20 percent of all breast cancers, is a very aggressive form of the disease, which has higher rates of metastases and poorer survival rates than other breast cancer subtypes.
The disease is difficult to treat and does not have an approved standard of care.
Currently approved targeted breast cancer therapies like Genentech Inc.'s Herceptin (trastuzumab) do not work in TNBC, noted Graham Crooke, a partner with Asset Management Co. Venture Capital, one of the early investors in BiPar. But, he said, BSI-201 has had some promising results in the disease and has potential applications in other cancers.
Barry Sherman, executive vice president for development for BiPar, noted that results presented in December 2008 showed that the drug was safe. The company plans to present more advanced results next month at the annual meeting of the American Society of Clinical Oncology.
The company anticipates initiating a Phase III trial in TNBC in the second half of this year, he said. BiPar also expects to have data from its Phase II trials in ovarian, uterine and brain cancers later this year or early next year, Sherman added.
He noted that his company has advanced BSI-201 through to Phase II with a "remarkable small" staff of 20 employees and a few outside consultants.
One of the motivating forces behind doing the deal with Sanofi, he said, is that the Paris pharma giant can provide the infrastructure necessary to drive BSI-201 through to approval.
"We certainly believe that Sanofi has development resources that will go far beyond what a small company like ours has," Schembri said. "I think the ability to utilize those resources will improve and hopefully accelerate the approval of the program."
Seth Rudnick, general partner with Canaan Partners, also an early investor in BiPar, said Sanofi's backing also will allow BSI-201 to achieve its full breadth as a cancer treatment, given the drug's potential broad applicability.
"Having Sanofi back it rather than just doing it with the resources that are available with a venture-backed company makes perfect sense," Rudnick told BioWorld Today.
The deal also is a good opportunity to show "how valuable biotechnology still is, that it can develop breakthrough compounds and do it relatively quickly and when it does so it attracts great interest," he said.
Asset Management's Crooke said his fund is expecting to make an 80 percent return on investment under the Sanofi acquisition.
"We are just over the moon," he declared, noting that the deal is going to return about half of Asset Management's $60 million fund if BiPar's product meets all of its milestones under the agreement.
While critics have declared that the biotech venture capital model is broken, Crooke said the BiPar-Sanofi deal "is a piece of evidence against that assertion." | 
