Gencia LLC, a nine-person biotech based in Charlottesville, Va., made an auspicious debut on the biotech stage with a potential $500 million deal with Takeda Pharmaceutical Co. Ltd. to develop a class of small-molecule drugs called mitochondrial agonists of the glucocorticoid receptor, or MAGRs. Gencia said its compounds may offer the benefits of conventional glucocorticoids but with improved potency and safety.

Although steroids are indicated for front-line, combination, maintenance and relapse therapy for many hematological and inflammatory indications, side effects, lack of response or induced resistance frequently limit their use, explained Allen Cunningham, co-founder, president and CEO of Gencia, which began operations in 2010. The company’s internally developed MAGRs are chemically distinct and may function differently than steroids, showing activity in numerous steroid-sensitive and steroid-resistant pharmacology models.

Cunningham was tight-lipped about details of Gencia’s platform, but the company is entirely focused on developing into a MAGR discovery engine. Once it identifies a mitochondrial target or pathway, Gencia combines structural biology with its mitochondrial targeting chemistry to design new compounds. Those candidates are tested preclinically for their ability to modulate the mitochondrial target or pathway of interest before a lead molecule is selected for investigational new drug-enabling studies.

The R&D collaboration with Takeda, of Osaka, Japan, will explore the potential therapeutic uses of MAGRs and the possibilities for their safe and effective application in chronic treatment. The goal of the partnership is to produce two preclinical candidates – one each in the areas of inflammation and oncology.

Under the agreement, Takeda will make up-front and preclinical milestone payments to Gencia for the two compounds, with the option to license the candidates following successful preclinical studies, in return for clinical, commercialization and sales milestones – in combination, totaling up to approximately $500 million. Gencia also is eligible for royalties on product-based sales from the partnership. The companies did not disclose additional details.

Takeda is responsible for designing and managing clinical trials for the candidates, and Cunningham said the timetable for those studies will be dictated by its partner. But Gencia clearly envisions the Takeda deal, which contains no additional right-of-first-refusal privileges, as a template for future collaborations.

“Our core competency is to be a discovery company,” Cunningham emphasized. “We’re not looking to in-license. Our efforts will be focused on early stage discovery and preclinical work, and we intend to stick with our model for partnering our mitochondrial therapeutics with pharmaceutical companies to leverage their clinical development and commercialization expertise.”


A consultant to Gencia introduced the companies less than a year ago and “there was a good fit from the outset,” Cunningham said. The Japanese pharma “appreciated the potential scope of our program as well as its novelty,” and the companies quickly moved into partnering talks, he added.

The Takeda deal could be just the tip of the spear for Gencia, which envisions a vast range of potential indications suitable for its MAGR therapeutics.

“Mitochondria are the energy factories of the cell, and their function plays a very important role in disease,” Cunningham told BioWorld Today, ticking off neurology, oncology, inflammation, cardiovascular disease “and other areas” as potential targets for Gencia’s mitochondrial targeting technology.

“It’s a very rich area for therapeutic development,” he said. “Our platform takes advantage of novel insights to improve the potency, selectivity, activity and safety of existing therapeutics.”

The “major program” partnered with Takeda, which Cunningham declined to specify, is the first to leverage that platform, “and that’s going to be our primary focus,” he said. “But we also have other targets and efforts in the works.”

Of more than three dozen mitochondrial therapeutics in the pipeline tracked by Cortellis Competitive Intelligence, Gencia has the only glucocorticoid agonist – an oral drug initially targeting psoriasis. The company also has a mitochondrial transcription factor A modulator in discovery targeting mitochondrial disease, according to Cortellis.

More common mechanisms of action for mitochondrial drugs currently in development include peroxisome proliferator-activated receptor, or PPAR, agonists, nicotinic acetylcholine receptor subunit modulators or stimulators and opioid receptor agonists, although Cortellis lists nearly as many target-based actions as mitochondrial drug candidates – more than half still in discovery.

Mitochondrial function is known to be regulated by PPAR-gamma and its coactivator PGC-1, and that pathway is successfully targeted by several diabetes drugs. In 2013, researchers at Harvard Medical School reported that targeting dysregulation in the pathway that regulates mitochondrial function was able to reverse both mitochondrial defects and the biochemical aging that resulted from those defects. The findings, they suggested, could lead to additional ways to fight the many diseases for which aging is a major risk factor – including metabolic and cardiovascular diseases as well as cancer. (See BioWorld Today, Dec. 27, 2013.)

And Takeda knows a thing or two about PPAR-gamma agonists after bringing the diabetes drug Actos (pioglitazone) to market. The drug, launched in the U.S. in 1999 following FDA approval, was dinged by the agency in 2011, which added a warning to the label that use of the medication for more than one year may be associated with an increased risk of bladder cancer. (See BioWorld Today, June 17, 2011.)

In August 2014, Takeda completed a 10-year epidemiology study, conducted as part of its post-marketing commitment, which concluded that long-term use of the drug was not associated with increased risk of bladder cancer. In July, the company submitted data from that study to the FDA, the EMA and the PMDA.

Cunningham brings fresh eyes to the biotech field. He spent more than two decades guiding venture-based companies in other sectors, including information technology, renewable energy and the Internet.

Like Cunningham, Gencia’s other co-founders and scientific leaders – Shaharyar Khan, chief scientific officer, and Francisco Portell, senior scientist – and many other team members conducted research or earned degrees from the University of Virginia, but the company otherwise has no ties with the school.

Gencia raised about $15 million from private investors and received grant funding from the NIH and the Department of Defense. In 2013, the company inked a collaboration with the Myelin Repair Foundation to develop multiple sclerosis therapeutics, according to Cortellis, but terms were not disclosed.

“We have no near-term financing plans,” Cunningham said. “But on a go-forward basis, we’ll certainly look for opportunities to finance and expand our development efforts and our pipeline.”

Gencia doesn’t expect big changes in the wake of its first big deal. The company plans to add a few staff positions over the next 12 months but will continue to lean heavily on its network of third-party consultants and organizations.

“We like our model of leveraging the best talent and expertise that we can,” Cunningham said.