DUBLIN – Boehringer Ingelheim GmbH is paying up to €1.18 billion (US$1.4 billion) to acquire antibody-drug conjugate (ADC) developer NBE-Therapeutics AG.

The deal includes an undisclosed up-front payment, plus development and regulatory milestones linked to the progress of NBE’s pipeline of clinical and preclinical ADC programs. The acquisition brings Ingelheim, Germany-based Boehringer an integrated ADC platform, including an in-house mammalian-cell-based antibody discovery capability, a proprietary anthracycline-based payload, a site-specific, enzyme-based conjugation technology and a set of proprietary non-cleavable linkers.

It also adds one clinical-stage program to its pipeline. Basel, Switzerland-based NBE recently moved NBE-002, which targets receptor-tyrosine-kinase-like orphan receptor 1 (ROR1), into a phase I/2 open-label trial in the U.S. The study is recruiting 100 patients with solid tumors, including triple negative breast, lung and ovarian cancers. Data are due in 2021.

The scale of the transaction is well below the $2.75 billion cash Kenilworth, N.J.-based Merck & Co. Inc. agreed to pay last month for NBE’s direct competitor San-Diego-based Velosbio Inc., which is in phase II trials with its ROR1-directed ADC, VLS-101.

Both moves come at a time of heightened interest in – and expectations for – ADC drugs. After several cycles of success and failure, the field finally appears to have entered a period of maturation, as evidenced by a growing number of drug approvals and big pharma deals.

Even prior to the present transaction, NBE-Therapeutics had been part of this trend. It recently entered a collaboration and license option agreement with Alameda, Calif.-based Exelixis Inc. which gave the latter company rights to nominate a defined number of targets against which NBE will develop ADC constructs. The Swiss firm banked $25 million up front and would receive additional undisclosed milestone payments should Exelixis proceed to develop and commercialize the resulting molecules.

The renewed interest in ADCs is linked directly to an improved understanding of the trade-offs between toxicity and potency. Early ADCs were unstable, which led to unacceptable toxicities, resulting from excessive release of their toxic payloads, before the constructs reached their cellular targets. Others were difficult to administer in a controlled manner because of their heterogeneity, which was a function of poorly controlled chemical conjugation methods that gave rise to molecules carrying different numbers of toxic payloads. NBE’s site-specific SMAC conjugation technology employs a bacterial sortase enzyme to generate full-length ADCs with pre-defined antibody-to-toxin ratios. It has claimed a therapeutic index for its molecules that is well in excess of

Although an early-stage venture from a drug development perspective, NBE-Therapeutics, which was founded by in 2012, has invested a considerable amount of time in building its ADC platform. It has raised over $65 million in equity funding since its inception, including a $22 million series C round completed last January. Boehringer has been involved in NBE from the outset, through its venture capital arm Boehringer Ingelheim Venture Fund. It became a seed investor in Jan. 2013 and led a small Series A round two years later. It also co-led the series C round with PPF Group.