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Avalon Ventures expands collaboration with GSK
SAN DIEGO—Avalon Ventures has announced that the group and GlaxoSmithKline (GSK) are expanding their collaboration to fund and launch early-stage life-science companies in San Diego. The collaboration is now worth up to a potential additional $60 million in combined funding and earn-outs per company if the company develops marketed products. Under the terms of the expanded collaboration, initially established in April 2013, Avalon and GSK will create and fund additional companies through the development of clinical candidates. Companies will also receive operational support, a fully equipped R&D facility and an experienced leadership team through COI Pharmaceuticals, the Community Of Innovation established by Avalon Ventures.
"The commitment by GSK has allowed us to move with unprecedented speed in transitioning concepts and ideas into functioning companies addressing unmet clinical needs," said Jay Lichter, Ph.D., managing director of Avalon Ventures and president of COI Pharmaceuticals. "The newest, Iron Horse Therapeutics, is pioneering a novel approach to ALS, a disease in critical need of solutions." The new company’s focus on Lou Gehrig’s disease, the neuro-degenerative disease that claimed the life of the Hall of Fame New York Yankees first baseman, whose every-game durability gave rise to his nickname as “the Iron Horse.”
"Avalon Ventures and COI Pharmaceuticals foster the type of innovative thinking that the pharmaceutical industry needs," said Lon Cardon, senior vice president, Alternative Discovery & Development at GSK. "The entrepreneurial and nimble companies we have founded in collaboration with Avalon will continue to build GSK's portfolio of innovative therapeutics."
Iron Horse Therapeutics, the seventh company launched to date under the Avalon-GSK collaboration, is researching and developing novel treatments for ALS that modulate the activity of a protein called EphA4. ALS patients with reduced EphA4 expression or activity have less severe disease and live longer. Interfering with EphA4 signaling protects motor neurons from degeneration, and, in ALS animal models, this approach has been shown to prolong survival and decrease disease severity.
Proprietary small molecule inhibitors of EphA4 were identified in the laboratory of Maurizio Pellecchia, Ph.D., professor of translational research at the Sanford Burnham Prebys Medical Discovery Institute. This technology was exclusively licensed from the Sanford Burnham Prebys Medical Discovery Institute to Iron Horse Therapeutics.
As with the other companies founded under the collaboration, Iron Horse will receive up to $10 million in Series A financing and R&D support from Avalon and GSK as well as R&D and mentoring support through COI Pharmaceuticals.
The collaboration between Avalon Ventures and GSK previously has launched Sitari Pharma, Silarus Therapeutics, Thyritope Biosciences, Adrenergics, Inc., Cadherx Therapeutics, and Calporta Therapeutics. According to Bruce Bigelow writing in xconomy, “None of the six startups have reached an exit yet, so the overall return-on-investment of the Avalon-GSK portfolio remains unknown. But the concept of combining the nimble startup mentality of a VC firm with the scale of big pharma has been servicing as a new business model for venture-backed innovation, and Avalon’s Lichter said he’s had a number conversations with other pharmaceuticals about the collaboration.”
Under the collaboration, GSK has the option to acquire each of the companies when a clinical candidate is identified. However, if GSK does not elect to exercise this option, Avalon will retain its ownership in the company, and the company will be free to enter into other strategic transactions.
COI Pharmaceuticals is an unconventional venture-pharma entity that provides life-science inventors with an environment where entrepreneurial and scientific risks are encouraged and rewarded. This Community of Innovation (COI) was established in 2013 to support companies funded through a collaboration between Avalon Ventures and GSK as well as existing Avalon portfolio companies. COI provides the intellectual capital to launch companies, a fully-equipped R&D infrastructure and industry mentors prepared to leverage their expertise to help entrepreneurial scientists succeed. COI is located in La Jolla, California.
Avalon Ventures is a venture capital firm that has founded and/or funded more than 127 information technology and life-science companies. The firm is passionate about backing talented entrepreneurs seeking to build market-leading companies. Throughout the firm's 32-year tenure, Avalon's long-standing and successful focus has been on seed and early-stage companies. All Avalon partners are seasoned entrepreneurs with experience in company formation, operations and value creation in the life-science and tech sectors. Avalon's current fund, launched in 2015, continues the firm's tradition of pursuing disruptive ideas in ever-changing markets.