The Russian connection

MONTREAL, Quebec—Alethia Biotherapeutics Inc., a privatelyheld biotechnology company focused on developing therapeutic monoclonal antibody(mAb) therapies, announced in late May that it has entered into a globalstrategic alliance with the Russian organization International BiotechnologyCenter (IBC) Generium to jointly develop AB-16B5, a mAB inhibitor ofepithelial-to-mesenchymal transition (EMT) that may have useful oncologyapplications.

Under the terms of the alliance, Alethia and IBC Generiumwill collaborate for the ongoing development of AB-16B5, and upon completion ofthe initial clinical study, share equally in the downstream economics interritories outside Russia and the Commonwealth of Independent States (CIS)nations. Alethia will receive an unspecified upfront cash payment and researchand development funding to conduct the initial clinical study in Canada. Inaddition to an exclusive license granted to IBC Generium for other territories,IBC Generium has also been granted the right to an exclusive license for Russiaand the CIS states for which development milestones and royalties would bepayable to Alethia.

The agreement signed between Alethia and IBC is the firstchance that the two companies have had to work together, but at the same time,it represents a continuing relationship to develop AB-16B5.

"Alethia was initially discussing the possibility to partnerthe anti-clusterin (AB-16B5) program with Affitech during the later part of2011," Yves Cornellier, president and CEO of Alethia, explains to DDNEWS. "Affitech was a public mAb company based inCopenhagen which was subsequently acquired by IBC Generium during the firsthalf of 2012. During the acquisition process, our discussions stopped withAffitech but resumed with people from IBC, this time in August 2012. Thediscussions intensified and reached the term sheet stage at the end of December2012. The deal was finally closed in May 2013."

"EMT is a key contributor to both tumor invasion and theemergence of resistance to many cancer therapies," noted Daniil Talyanskiy,chief business officer at IBC Generium, in the news release about the deal,saying how pleased his company is to have formed this global strategic alliancewith Alethia. "The excellent EMT inhibitor program developed at Alethiarepresents a unique opportunity for our company to accelerate the developmentof a novel therapy with potential applications in multiple cancer indications."

Alethia wanted to find a partner for this potentialtherapeutic, Cornellier says, because this product was the only one that hadnot emerged from Alethia's proprietary STAR target discovery platform.

"This product was actually in-licensed from the NationalResearch Council of Canada in 2007 in order to have a mAb product on which thecompany could acquire mAb product development expertise before its currentproducts reached the clinic," he explains. "Given that the company had now twoother products discovered with its platform and already at the preclinicalstage, the board of directors felt that it was in the strategic interest of thecompany and shareholders to prioritize these products and use non-dilutiverevenue obtained from a partner to further advance the program and create morevalue for both companies if at all possible."

The bare minimum goal of IBC and Alethia is to bring AB-16B5to the end of Phase I/II clinical testing (proof of efficacy in a patientpopulation) before finding a partner interested in acquiring a global exclusivelicense and bringing the product to the market.

"It is understood that IBC and Alethia would share theprofit of any such transactions," says Cornellier. "It is also understood thatthe global license in question would exclude Russia and the CIS territories forwhich IBC had already concluded an exclusive option to license agreement withAlethia for this part of the world."

Alethia brings to the table a lot of expertise and know-howin the field of EMT, Cornellier says, and the company believes that AB-16B5 isthe most potent inhibitor of EMT being developed right now. On the IBC side, headds, the company is currently the largest biotech company in Russia, and"aside from its expertise in manufacturing mAbs and other biologics in Russia,is committed to participate in the development of new innovative productsglobally and locally and has the critical human, physical and financialresources to achieve its goals."

Further, Cornellier notes, it is the understanding ofAlethia's leadership team that IBC is committed to the idea of concludingseveral more transactions like the one just forged with Alethia to strengthenits own product pipeline.