Although it had plenty of money in the bank, Idun Pharmaceuticals Inc. made a strategic decision to become part of a big pharmaceutical company that will help advance its lead liver disease product.
The San Diego-based company was in discussions with Pfizer Inc. for several months over a potential relationship. Those talks led to an agreement for New York-based Pfizer to acquire the 12-year-old private company, which is focused on caspase inhibitors.
"We'd been talking with them for a long period of time in the context of a potential relationship," said Steven Mento, Idun's president and CEO. "It just went this way. It wasn't a plan on our part. The company was in a very strong position."
Idun raised $27 million just last year in the first tranche of a $65.6 million financing. That initial money was expected to take the company through two years of operations. (See BioWorld Today, June 15, 2004.)
Financial terms of the acquisition were not disclosed, but both parties expect to complete the transaction in the second quarter.
Since its inception in 1993, Idun has built a portfolio of more than 150 patents covering drug targets, new chemical entities, drug-screening assays, diagnostics and antibodies. The company was founded by Robert Horvitz, a professor of biology at the Massachusetts Institute of Technology, and John Reed, CEO of the Burnham Institute. Horvitz won the Nobel Prize for Medicine in 2002 for his discoveries concerning the regulation of organ development and apoptosis. Idun's technology is focused on controlling the activity of caspases, a group of cellular proteases involved in the pathway of apoptosis and inflammation.
"There's been wide recognition throughout Idun's existence of the eloquence of the science associated with the technology and the high level of sophistication that Idun has brought to that technology," Mento told BioWorld Today. "But there was some pause as to whether that would translate into meaningful products."
Idun's lead caspase inhibitor, IDN-6556, provided the proof. The product is in two Phase II trials in liver transplantation, given intravenously, and in patients infected with hepatitis C virus, given orally. Phase IIa data have shown that IDN-6556 given orally was well tolerated and improved markers of liver damage in patients infected with HCV. The drug might represent a new class that protects the liver from inflammation and cellular damage induced by viral infections, and things like fatty liver disease and alcohol abuse.
Data from the two ongoing Phase II trials should be available later this year. At that point, Pfizer might decide to move it into Phase III trials, said Stephen Lederer, Pfizer's media relations director of research and development.
"One of the reasons this is a good fit is we've got the power to get things to market as quickly as possible," he said. "We see [IDN-6556] as a very exciting prospect. If anyone can get it through clinical trials in a timely way, it's us."
Mento agreed, saying that Pfizer believes in Idun's technology and provided the best opportunity to advance it. In addition to IDN-6556, Idun is working on two preclinical programs in the fields of cancer and asthma, as well as several earlier-discovery-phase programs.
"We felt ultimately that the opportunity was going to be much larger than a company of 54 employees was going to be able to handle," Mento said.
Idun and Pfizer will continue to discuss the details of the acquisition, to decide whether or not Idun will become a subsidiary, as well as how the employees will fit into the new structure. Those details should be ironed out within a few months.
The purchase represents Pfizer's second acquisition of a biotech company within a month's time frame. The company bid $527 million in January for La Jolla, Calif.-based Angiosyn Inc. (See BioWorld Today, Jan. 25, 2005.)
Lederer said Pfizer is no different from any other large pharmaceutical company, looking for ways to build out its internal pipeline. Some companies fear the "not-invented-here syndrome," he said, but pharmaceutical companies need to look outside their own research departments at the innovation coming out of companies such as Angiosyn and Idun.
"You cannot get into that notion of thinking that we do everything better," he said.