Dr. Arie Belldegrun, formerly Kite Pharma’s CEO, and Executive Chairman of Allogene Therapeutics, will be delivering the opening plenary talk at MIXiii-BIOMED conference, May 15-17, Tel Aviv.
by john carroll — on
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After pioneering one of the first personalized CAR-T therapies to be approved by the FDA, Kite vets Arie Belldegrun and research chief David Chang have now launched a new biotech with a whopping $300 million in cash financing and a collaboration with Cellectis after bagging the full portfolio of off-the-shelf CAR-T drugs in development at Pfizer.
Belldegrun — who came away with a fortune of more than $600 million from the sale of the biotech to Gilead — tells me he gained swift backing from a broad syndicate to create Allogene Therapeutics. And they’re jumping out of stage left with a deal that gives them control of Pfizer’s CAR-T portfolio, which includes rights to the early-stage UCART19 allied with Paris-backed Cellectis.
In exchange, Pfizer is getting a 25% stake in Allogene, which immediately vaults from out of nowhere into a leading position among developers of off-the-shelf CAR-T therapies, looking to leapfrog the first generation of personalized CAR-Ts that use reengineered patient cells.
“We have every one of the interesting targets that I’m aware of,” says Belldegrun, the newly minted executive chairman at Allogene, with Chang taking the CEO job. And they’re ready to get to work with Cellectis, Servier and everyone else engaged in the “Manhattan project” of bringing the first allogeneic CAR-T to market.
“This is the biggest project,” Belldegrun says. “This is where cellular therapy will find its way.”
Belldegrun and Chang told me in a preview of the announcement Monday evening that the deal began to come together the night they were celebrating the close of the Kite sale, when one of the bankers involved told them about a potential deal he knew of.
Instead of a leisurely vacation break, what followed was 5 months of intense negotiations, in which Belldegrun got a close, upfront look at the 16 targets that a team of 70 Pfizer investigators have been working on for the past 4 years, along with UCART19, the 17th program in the deal.
“I looked at the data and said ‘David, we need to do this, it’s a gold mine.’ It’s a deal I couldn’t refuse,” says Belldegrun. “We know it’s the future.”
Instead of a lengthy and expensive personalized autologous approach that requires the extraction and reengineering of patient cells into a potent therapy that has proved particularly effective in blood cancers, Belldegrun will now look to perfect a gene editing process that can develop 50 to 100 therapeutic batches from a single donor. If it works, it will be cheaper and faster than the first CAR-Ts, Yescarta and Kymriah.
This was a deal that involved “multiple” bidders, says Belldegrun, willing to pay a significant amount to buy in. But he says he and Chang were able to put together the winning offer by keeping Pfizer closely engaged in the startup and a clinical drive that could get them to the threshold of commercialization in just a few years.
With backers deeply impressed by their $12 billion sale of Kite to Gilead, Belldegrun and Chang are working with investments from TPG, Vida Ventures, BellCo Capital, the University of California Office of the Chief Investment Officer and Pfizer.
The pair of entrepreneurs are getting a team of about 50 Pfizer investigators to transfer over in the deal, taking over Pfizer space for now in South San Francisco as they scout their own new digs. And Belldegrun says they have already lined up a string of “top notch” players to join the company.
You can expect the payroll to double in the next year, he adds.
The deal teams Belldegrun and Chang with Cellectis CEO André Choulika, the French biotech exec who’s been steering the first off-the-shelf CAR-T into human studies. Servier and Pfizer launched a landmark trial of Cellectis’ UCART19 for acute lymphoblastic leukemia, getting the green light to expand from the UK into US sites a year ago.
I ran into Choulika at an analysts meeting Belldegrun organized for Kite in New York a couple of years ago. It struck me as odd seeing the allogeneic leader at the rival autologous gathering, but Choulika tells me it was part of a long relationship that has converged into this new deal.
“Arie and myself have been talking for a long time,” Choulika told me. The mutual respect they developed, he says, combined with Kite’s sterling rep for execution, helped bring it all together.
“I was convinced that Kite would be the winner in the autologous space,” says Choulika. And he thinks the new team at Allogene, combined with Cellectis’ know-how on gene editing, will accelerate the work on their lead therapy, with a shot at commercialization work in late 2021 or ’22.
The technology may be still appear to be quite early, but Belldegrun paints a picture of global investors eager to get in now.
The $300 million came together in a matter of weeks, says Belldegrun, who adds that it would have been easy to raise twice that amount. For now, he’s not short of cash — and he says he and Chang also put their own money into the deal. As they go forward, considering the need to build their own dedicated manufacturing, he expects they’ll be able to raise more cash as needed.
So why not take the money from the Kite deal and take an extended vacation?
“I think at the end it’s not money that drives what we do,” says Chang, who was cleared to leave Kite in February after staying on for the transition. “It’s really the activity that will satisfy you, or something that’s deep down in you.”