scorecardA CEO who sold his last cancer drug company for $12 billion just got $300 million to do it again
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A CEO who sold his last cancer drug company for $12 billion just got $300 million to do it again

A CEO who sold his last cancer drug company for $12 billion just got $300 million to do it again
Finance4 min read

Cancer immunotherapy


Cancer cells are seen on a large screen connected to a microscope at the CeBit computer fair in Hanover, Germany, March, 6, 2012.

  • Two executives who helped get one of the first cancer drugs that's part of "a big new field of medicine" approved are back just a few months later with a new startup called Allogene.
  • This time, they've got $300 million to see if they can pull it off in a less personalized way using new cell therapies licensed in from Pfizer.
  • Its farthest along treatment is headed into phase 2 clinical trials in 2019.
  • Allogene is led by former Kite Pharma executives who sold the company in August 2017 to Gilead Sciences for $12 billion. Allogene CEO David Chang told Business Insider he hadn't expected to see a way to do less-personalized cell therapies so soon.

Two top executives from one of the first companies to get a cancer drug that's part of "a big new field of medicine" approved just raised $300 million to do it again - this time in a less personalized way.

The startup, called Allogene, raised $300 million in a series A round that included Two River, TPG, Vida Ventures, BellCo Capital, the University of California Office of the Chief Investment Officer and Pfizer. The company's hitting the ground running by picking up the rights to certain cancer treatments that Pfizer had been developing.

Arie Belldegrun, the former CEO of Kite Pharma, will serve as executive chairman at Allogene, while David Chang, former executive vice president of research and development at Kite, will serve as Allogene's CEO.

Chang, who's been working in cancer research for 30 years, told Business Insider that through his work at Kite, he knew less-personalized versions of the cancer treatments, known as CAR T-cell therapy (CAR is short for chimeric antigen receptor) had to happen, but he didn't expect them to come along so soon.

"I personally thought it was five to 10 years before allogeneic therapy can come to fruition," he said. Allogeneic is the term used to describe treatments that can be used in anybody, as opposed to being tailored to an individual. But when he looked into the work Pfizer had been doing, he was convinced.

"It was really prime-time, it was quite ready for somebody with a little more experience in the cell therapy space to come in and try to take the product to the finish line."

Re-engineering cells to go after cancer

David Chang Headshot_3112_LR_pp_comp_cc_web[1]

Courtesy Allogene

Allogene CEO David Chang

In August 2017, Kite got acquired by Gilead Sciences for $12 billion. Two months later its first drug, a CAR-T cell therapy called Yescarta, was approved by the FDA. These therapies - approved for certain forms of blood cancer - aren't your run-of-the-mill pill that can be mass produced. Since the therapy is made from a person's own immune system, the process can take about three weeks.

To start, a doctor removes some white blood cells, the part of our body's immune system responsible for combatting infections and foreign substances, from a patient. In a healthy body, the immune system can recognize abnormal, cancerous cells, but for people with cancer, it doesn't recognize that the cells are spreading. Then the cells are taken to a manufacturing facility at which point the cells are reengineered to recognize cancer cells and wipe them out. Those reprogrammed cells are sent back and administered to the patient.

Ideally, this could one day become a system in which you could just pull a treatment off the shelf and use it in anybody, so it doesn't have to take so long and be so tailored to an individual. It's work a number of companies have been doing as a way of enhancing the cell therapy technology that exists today.

As part of its deal with Pfizer, Allogene gets the rights to 16 preclinical CAR-T therapies, which includes treatments for both blood and solid-tumor cancers. The experimental treatments come out of a collaboration between Cellectis, a gene-editing company, and Pfizer. In return, Pfizer gets a 25% stake in Allogene.

Allorgene's also picking up a drug in early trials in humans called UCART19, which is being developed to treat acute lymphoblastic leukemia. Allogene in partnership with French pharmaceutical company Servier plan to move the drug into phase 2 trials in 2019.

The difference with these treatments are that instead of taking the cells from a patient with cancer, they use healthy donor T-cells that have been gene edited to keep them from being rejected by the immune system. They're still re-engineered in the way currently approved CAR-T cell therapies are, but instead of waiting up to a month for a treatment specific to one person, these gene-edited versions could be available much sooner.

These more off-the-shelf treatments will be key for getting the treatments into solid tumors that are almost too complicated for the super-personalized cell therapies, Chang said.

The funding will be used to advance UCART19 into later-stage trials that it can use to potentially go before the FDA for approval, as well as moving some of the pre-clinical programs into human trials.