By Jim Shrine
Hybridon Inc. gave new life to work developed over a five-year period with F. Hoffman-La Roche AG by spinning out a new subsidiary, OriGenix Technologies Inc.
That move also provides the financing needed to take the work off the shelf. Three Montreal-based venture capital firms committed about US$4 million to gain an interest of 51 percent in OriGenix. Hybridon, for its 49 percent interest, licensed antisense compounds and other technology to the new company.
Hybridon, of Milford, Mass., was not able to fund further development of the program, which the company regained when Hoffman La-Roche, of Basel, Switzerland, backed out of the alliance in September 1997. Hybridon earlier had spun out some its cancer work into MethylGene Inc., of Montreal, which has secured $24 million in equity financing and $6 million from the government. Hybridon owns about 30 percent of that company.
Hybridon didn¿t have the resources to fund those programs internally.
¿We have a platform technology and eight projects under development, with 10 in reserve,¿ said Andy Grinstead, Hybridon¿s president, chairman and CEO. ¿Splitting these out is a form of partnering. We¿re giving up some of the opportunity, but moving these things ahead with a source of funding. We give up some ownership, but it gets capitalized.¿
Venture To Focus Initially On Antisense HPV Drug
The initial focus at OriGenix is on developing an antisense-based compound, Ori-1000, targeting human papillomavirus (HPV) for treating genital warts. Further back is work on nucleic-acid-based compounds for hepatitis B virus (HBV). But the company intends to use expertise in nucleic-acid chemistry to broaden the focus.
Doug Jensen, previously Hybridon¿s vice president of administration and corporate development, is the president and CEO of Laval, Quebec-based OriGenix. He said the initial funding will see the company through two years.
¿We¿re not limited strictly to antisense,¿ Jensen said. ¿We also will have a very strong discovery program based on nucleic-acid technology. We have the ability and the right to create novel classes of molecules, which we would then screen against other viral targets and infectious agents.
¿Our goal is to advance the HPV compound to the clinic and bring innovation to bear, in terms of the chemistry for future discoveries,¿ Jensen said. ¿We¿re not limited in the way we are going to apply the whole nucleic-acid-based technology platform, of which antisense is one application.¿
Much of that effort will rest with Chris Iyer, head of discovery research at OriGenix, who also came over from Hybridon. Grinstead said the move will allow Iyer to be more creative in applying nucleic-acid chemistry beyond antisense mechanisms.
Hybridon will provide manufacturing and consulting services to OriGenix. Each company also has access to new discoveries made by the other.
¿If we have some kind of major breakthrough that¿s applicable to targets we¿re not working on, Hybridon will have the first right to license those improvements,¿ Jensen said. ¿We want this to continue to be a symbiotic relationship. We¿re tied in a number of ways. It¿s a real value-builder for both sides.¿
Grinstead said the financing environment in the Montreal area made this deal possible, as well as the spinout of MethylGene. ¿We had a lot of people in Canada interested in supporting this,¿ he said.
BioCapital Investments LP last May provided some seed funding and also participated in this round. The others were Le Fonds de Solidarite des Travailleurs du Quebec, a labor-sponsored fund, and Societe Innovatech du Grand Montreal, a state-owned venture capital corporation.
The venture capital firms are committed to investing another $1.3 million in OriGenix if the company reaches certain milestones in development of its HPV compound, and if a lead compound is identified against another target, which may or may not be HBV, Jensen said. That additional investment would increase their ownership position to 60 percent.
Jensen said OriGenix is working on a topical formulation for HPV, and hopes to be in the clinic next year. In about a year, the company also hopes to have identified a lead HBV compound, he said. n