ArsenalBio lands $70M cash deal with cancer giant Genentech to develop cell therapy

San Francisco-based ArsenalBio’s designer T cells program is attracting the attention of some big players.

After closing a deal and grabbing $70 million in cash from Bristol Myers Squibb last year, the company is back in the news with a brand new deal, this time with Genentech.

ArsenalBio will receive $70 million upfront from Genentech along with research support, the companies announced Tuesday. Under the collaboration, both companies will share research ideas and develop targeted T cells for solid tumors.

“It is a large collaboration of scientists from both sides, who have backgrounds in immunology, genetic engineering, screening, computing, and machine learning,” said ArsenalBio’s CEO and co-founder, Ken Drazan.

Aviv Regev

The initial talks about the deal started after Drazan sent an “inquiry” email to Aviv Regev shortly after she joined Genentech as an executive vice president in 2020.

“Over a period of time, that went from informal conversation to diligence process to contract negotiation,” Drazan added.

Among ArsenalBio’s key products are its CRISPR-edited T cells. The company has figured out a unique location within T cell DNA where huge chunks of genes can be inserted. This allows for specific edits and lowers the risk of DNA translocations and recombination, resulting in less toxicity to patients, Drazan said.

Laboratory-edited T cells called CAR-Ts are sometimes given to cancer patients to fight off their disease with higher specificity. While CAR-T therapy has shown promising results in blood cancers, it hasn’t found the same success in solid tumors.

“Solid tumors are harder to find for the T cells than liquid tumors,” Drazan said.

One of ArsenalBio’s goals is to develop T cells that have “long trafficking experience” in the body, allowing the cells to survive in a patient’s body for a longer time without experiencing T cell exhaustion.

While the company’s lead program is for refractory ovarian cancer and may enter the clinic later this year, it is also beginning work on kidney and prostate cancers.

James Sabry

The learnings from the collaboration will be used in the development of future therapeutic candidates. “By partnering with ArsenalBio, we are accessing powerful technologies to advance the understanding of the biological programming of T cells that might be crucial in providing important therapies for difficult-to-treat cancers,” said James Sabry, global head of Roche Pharma Partnering.

Genentech has made splashy deals in cell therapies before. Last year, the company inked a deal worth $3 billion with Adaptimmune to develop T cell therapies for multiple cancer indications.

Meanwhile, ArsenalBio has seen a steady rise in funding since its founding in 2019. Just a couple of weeks ago the company raised $220 million in Series B Funding, with backing from Bristol Myers Squibb, Byers Capital, Emerson Collective Investments, Green Sands, Hitachi Ventures and Sixth Street, among others.

“Genetic engineering of T cells opens the door for the promise of a cure. And that’s a new language that we never used in the industry before. Now, that possibility is in front of us,” Drazan said.

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