Tokyo-based Astellas Pharma Inc. agreed to pay $120 million up front in a deal that could be worth as much as $665 million to Xyphos Biosciences Inc., of South San Francisco, which will become a wholly owned subsidiary of Astellas, bringing aboard the ACCEL (Advanced Cellular Control through Engineered Ligands) platform plus a roster of immuno-oncology talent.

The Xyphos approach allows for directing cells of the immune system to target single or more than one tumor antigens while controlling their proliferation and endurance, with molecules that can be delivered to natural immune cells or to engineered chimeric antigen receptor (CAR) cells. The CAR technology is based on an engineered modification to a natural human receptor dubbed NKG2D, which turns up on natural killer cells as well as some T-cells. As modified, NKG2D is inert and unable to bind to any of its natural ligands, which manifest on stressed cells.

Through further protein engineering, several natural ligands of NKG2D have been tweaked so that they bind exclusively to the otherwise inert NKG2D receptor. Various functional molecules – such as antibodies that recognize specific tumor antigens – are attached to the modified ligand. They bind exclusively to immune cells expressing the inert CAR on their surface, i.e., what Xyphos has branded convertibleCAR-cells. These can be directed by the ligand-bound antibody to seek and attack a specific cancer cell. The hypothesis is approaching a major test in 2021, when Xyphos’ first convertibleCAR-T cell candidate is expected to undergo its first-in-human study. Astellas said the impact of the deal on financial results in the fiscal year ending March 31, 2020 will be “limited.”

In October of last year, The Parker Institute for Cancer Immunotherapy in San Francisco hooked up with Xyphos in CAR-T deal, taking aim at multiple cancer types with the convertibleCAR strategy. The acquisition news comes a week after the FDA granted accelerated approval for Padcev (enfortumab vedotin-ejfv) for adults with locally advanced or metastatic urothelial cancer who have previously received a PD-1/L1 inhibitor and platinum-based chemo before (neoadjuvant) or after (adjuvant) surgery or in a locally advanced or metastatic setting. The antibody-drug conjugate targets Nectin-4 and is partnered with Seattle Genetics Inc., of Bothell, Wash. Non-clinical data suggest Padcev binds to Nectin-4-expressing cells, leading to the release of anti-tumor agent monomethyl auristatin E, though continued approval is pending verification and confirmatory trials.

Earlier this month, Astellas grabbed gene therapy specialist Audentes Therapeutics Inc., also of San Francisco, for $60 per share in cash, meaning an equity value of about $3 billion. The deal is expected to finish in the first quarter of next year. Audentes’ lead candidate is AT-132 for the treatment of X-linked myotubular myopathy, with a BLA submission slated for mid-2020.

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