Big Pharma Strikes Megadeals In Targeted Protein Degradation

12/11/2021 - 5 minutes

With many targeted protein degraders hitting the clinic, lucrative collaborations and acquisitions are being signed between biotech startups and big pharma in this upcoming area. 

Novartis, Pfizer, and Bayer have all negotiated billion Euro deals this year with smaller biotechs including Dunad Therapeutics, Arvinas, and Vividion Therapeutics. The big pharma companies aim to gain a foothold in the targeted protein degradation market.  

Around 15 targeted protein degraders are predicted to enter clinical trials by the end of the year. Unlike traditional drugs, which often block a protein’s action by binding to a specific site, targeted protein degraders harness the cell’s natural waste disposal system, removing harmful proteins by flagging them for destruction. 

The principle could be applied to any disease, in particular those previously considered ‘undruggable.’ The concept is therefore an attractive investment opportunity that holds the potential for blockbuster medications in therapeutic areas including cancer and neurology.

Protein degradation is one of the most exciting new drug development modalities emerging today and has already moved quickly using well understood development paths to generate clinical proof of concept data,” said Nicola Thompson, CEO of Scottish targeted protein degradation startup Amphista Therapeutics

Amphista has had a successful year, closing an oversubscribed €45.7M Series B funding round in March that included investment from the Novartis Venture Fund.

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Thompson said she welcomes the arrival of large deals to the field. “It’s really exciting to see new entrants in the protein degradation field and the continuing interest of large pharma in collaborative models to bring protein degrading approaches to benefit larger numbers of patients,” she said.

This month saw Novartis enter into a collaboration with Dunad Therapeutics in the UK. The deal could see the big pharma paying out well over €1B for the development and marketing of Dunad’s oral targeted protein degraders. 

As part of the deal, Dunad will receive €20.7M as an upfront payment and equity investment, plus research funding. It will also be eligible for up to €1.12B for discovery, development, regulatory and sales milestones as well as royalty payments. Novartis in return gains access to Dunad’s platform to generate small molecule drugs against up to four drug targets. The therapeutic areas for these projects were not disclosed.

Dunad’s stratospheric rise is particularly eyebrow-raising given it only emerged from stealth mode in March this year. The firm’s founder and Chief Operating Officer, Diana Kraskouskya, highlighted the unique advantages offered by targeted protein degradation as an alternative to conventional drug discovery programs, which can have trouble finding relevant binding sites on the target protein.

Typically, small molecule or antibody therapeutics work by blocking a specific function of a protein target but may not block all of its functions, some of which may also be disease-causing,” she said. “Targeted protein degradation, on the other hand, tags the protein for destruction thereby blocking all of its functions.”

Novartis is not the only major pharmaceutical company seeking a foot in the door. This July, Pfizer announced a €2B deal for options to develop and commercialize a protein degrader made by US-based Arvinas to fight breast cancer. 

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Arvinas’ drug is currently in phase II development and Arvinas will receive a €561M ($650M) upfront payment plus potentially €1.2B ($1.4B) in milestone payments, with Pfizer making a €301.9M ($350M) equity investment in the company.

Meanwhile, in August, Bayer acquired US biotech Vividion Therapeutics for €1.3B upfront plus up to €431M in milestone payments. And in a smaller deal in April, Bristol Myers Squibb decided to extend its protein degradation partnership with the German heavyweight Evotec, further cementing confidence in the field. 

Targeted protein degrading drugs called proteolysis-targeting chimeras, or PROTACs, currently dominate the field. PROTACs are two-headed small molecules where one end binds to the protein being targeted and the other recruits a ligase enzyme that degrades it.

Several targeted protein degrading drugs that use this double-ended structure have either reached or are approaching clinical studies. Other methods in development include molecular glues — small molecules that force their target protein into contact with a degrading enzyme — and lysozyme- and autophagy-targeting chimeras, known as LYTACs and AUTACs, which employ a different type of protein degradation to PROTACs.

Dunad uses one-headed small molecules to directly modulate the surface of the target protein. The company claims this can reach the central nervous system more easily than PROTACs, and it is focusing on this as well as oncology targets, several of which are not accessible by PROTACs. 

“Dunad’s platform is designed to enable the development of orally bioavailable and CNS-accessible monovalent protein degraders – an approach that expands the frontiers of protein degradation modalities and is beyond what has been actively explored to date,” said John Tallarico, Novartis Institutes for Biomedical Research head of chemical biology and therapeutics.

We hope this partnership will allow us to go after disease-causing proteins that have proved until now to be undruggable using other approaches.” 

Cover image via Elena Resko

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