By Dan Fost
With innovation as the watchword, a biotech spinoff from the UCSF School of Pharmacy announced a $40 million Series A round of investment last week – hailed by an investor as “one of the largest first rounds of financing in some time.”
Calithera Biosciences, which launched this year out of the lab of Jim Wells, PhD, at Mission Bay, brings a novel approach to killing cancer cells that several major biotech investors see as having the potential to help speed recovery from the disease.
Calithera provides the latest example of cutting-edge research and technology that have originated at UCSF and spun out into companies or industry partnerships, with the intent of having a direct, positive impact on patients’ lives. Since UCSF spawned the biotech industry in the 1970s with the launch of Genentech and the discovery of recombinant insulin as the first biotech drug, the University has issued 1,757 biomedical patents and has spun off more than 66 companies from its research.
Those UCSF patents have led the UC system in generating license and royalty fees during these cash-tight times. The UCSF discovery that led to the current hepatitis B vaccine generates the largest royalties of the entire UC system, and the discovery of human growth hormone, which was developed and brought to market by Genentech, is among the top five.
Although it’s not the largest UC campus, UCSF has consistently ranked first in the 10-campus system, as measured by total utility licenses issued, total utility patents and total license income. Over the last 10 years alone, the biomedical campus has issued 602 UCSF patents, averaging $64 million per year in licensing, litigation and royalty income.
“We are certainly very prolific in winning US patents, and overall, we’ve been very successful in licensing,” said Joel Kirschbaum, PhD, director of the UCSF Office of Technology Management. While Kirschbaum said the licensing revenue helps support programs as well as the University’s educational mission, he noted, “Our fundamental mission is to transfer the fruits of publicly funded research to benefit the public.”
The real win in cases like Calithera, he said, will come if the therapy the company develops achieves its goal of significantly helping cancer patients.
Calithera’s announcement comes one month after the release of an economic impact report that UCSF commissioned, which showed that the University – through its vast research and medical enterprise – has a $6.2 billion annual economic impact on the Bay Area.
The Calithera deal also stands in the vanguard of a new model that could generate faster translation of scientific research into patient care, while also increasing funding to the UC system. Among its venture backers is Mission Bay Capital (MBC), an independent venture fund that is managed by the California Institute for Quantitative Biosciences (QB3), based at UCSF’s Mission Bay campus.
“In the long term, universities need to be more innovative about finding revenue streams to survive,” said Douglas Crawford, PhD, QB3’s associate director and a pro bono managing partner of Mission Bay Capital, noting that California will never return to its 1960s-level of investment in the University system. “We’ve got to be nimble about finding resources.”
MBC benefits from advisers that include renowned investors Brook Byers, Chris Christoffersen, PhD, and John Wadsworth Jr. as it helps connect savvy investors with the world-class research taking place in University labs. In the past few years, UCSF has put a renewed emphasis on working with industry in an effort to expedite translational medicine, a trend that has accelerated under Chancellor Susan Desmond-Hellmann, MD, MPH, a former Genentech executive.
Like Desmond-Hellmann, Wells is a veteran UCSF scientist who left the University for a long stint in industry. A member of the prestigious National Academy of Sciences, Wells spent 16 years at Genentech, and then started his own firm, Sunesis Pharmaceuticals, now a publicly traded company. He returned to UCSF in 2005 and now chairs the Department of Pharmaceutical Chemistry in the School of Pharmacy, with a joint appointment in the School of Medicine’s Department of Cellular and Molecular Pharmacology.
His lab is focused on understanding and modulating signals in human cells, working with small molecules. For the past five to seven years, the lab has taken an unconventional approach to studying caspases – enzymes that kill cells – which cancer cells have been able to avoid. Most drugs work to inhibit enzyme function, but Wells’ lab has studied what would happen if the enzymes were activated instead.
“Cells have within them the ability to commit suicide,” Wells said. “When they are heavily virally infected or have accrued mutations on the pathway to developing cancer, they have inborn mechanisms by which can they commit suicide for the benefit of the organism. But most cancers find a way to avoid this inborn mechanism. They create mutations that don’t allow it to happen.”
Many cancer drugs try to stimulate that process of programmed cell death, known as apoptosis. Those drugs start at a point that, Wells said, is upstream from the cancer. They launch what he called a “bucket brigade” designed to cause cell death farther downstream. The problem, he said, is that “cancers figure out ways to lesion it, and avoid the bucket brigade. We thought it might be an interesting approach as an anticancer drug if we could activate caspases directly” at the downstream junction.
Three years ago, a postdoctoral fellow in the lab, Dennis Wolan, PhD, used a high-throughput screen in Wells’ Small Molecule Discovery Center at QB3 to discover a compound that would activate the caspases in a cancer cell and kill it. “For reasons we don’t fully understand, but are beginning to understand, it will kill cancer cells much more rapidly than other cells,” Wells said.
The lab published a paper in Science last fall, which attracted interest from venture capitalists. Teaming up with biotech industry veteran Susan Molineaux, PhD, who is co-founder and chief executive officer of Calithera, led to the formation of the company, which is based in South San Francisco.
In last week’s announcement, Calithera announced the hiring of Molineaux and the rest of the management team and board of directors, which includes Wells. The $40 million funding round was led by Morgenthaler Ventures and included, in addition to Mission Bay Capital, US Venture Partners, Advanced Technology Ventures and Delphi Ventures.
“Small-Molecule Activators of a Proenzyme”
Dennis W. Wolan, Julie A. Zorn, Daniel C. Gray and James A. Wells
Science, November 2009;326(5954):853-858