UCL spin out sold to Amgen in $1 billion deal

BioVex, a cancer vaccines specialist spun out of University College London (UCL) is being acquired by US biotechnology giant Amgen in an all-cash deal worth up to $1 billion. Amgen is paying $425 million upfront, with a further $575 million to come on reaching some clinical and regulatory milestones.

The acquisition is a welcome return for the venture capital (VC) investors who have supported the company through six private rounds of investment, since it was formed in 1999 around research carried out at UCL by virologist Robert Coffin. Most recently, in November 2009, BioVex raised $70 million in a round led by long-term investor Forbion Capital Partners.

Sander Slootweg, managing partner at Forbion said the sale is a landmark transaction for the Dutch VC. “We have been BioVex’s largest shareholder for several years, and have supported the company by leading and structuring its recent funding rounds.”

“Before we decide to invest, we like to think an exit is possible in 3 – 5 years. But with good, breakthrough products [like BioVex’s] it can be difficult to see what hurdles have to be overcome,” Slootweg told Science|Business.

Following its formation, BioVex set up operations in Abingdon, near Oxford, but moved its headquarters to Massachusetts in 2005 to enable it to tap US investors. However, a hoped-for an initial public offering failed to get off the ground in 2006.

Despite this setback, the company continued to raise venture capital and has reported impressive data for its lead product OncoVex GM-CSF, which is now in two Phase III trials in head and neck cancer, and melanoma. The company has agreed special trial protocols with the US regulator, the FDA, and positive results in the trials will lead directly to market approvals.

OncoVex GM-CSF consists of a herpes simplex virus that has been genetically modified so that it is harmless to normal cells, but is able to enter and kill cancer cells. At the same time it stimulates the body’s own defences by delivering the gene for granulocyte macrophage-colony stimulating factor, which mobilises the immune system.

The Phase II trial in melanoma involved 50 patients with advanced disease who had failed on other treatments. They were treated with OncoVex GM-CSF as a stand-alone therapy. Overall, 28 per cent responded, with ten patients having a complete response and four patients a partial response. A further 10 further patients had stable disease for more than three months. Of those who responded in anyway, overall survival at one year was 58 per cent, and 52 per cent at two years. The Phase III trial, involving 360 patients is now fully recruited.

The Phase II head and neck cancer study enrolled 17 patients with advanced disease, of which 93 per cent had a complete response. At 30 months follow-up none of the patients had any recurrence of the cancer in the neck, and 82 per cent were still alive.

The Phase III study in head and neck cancer began in December 2010 and will recruit 500 patients.

BioVex has a second clinical-stage product, a vaccine against genital herpes, which is currently in a Phase I trial in the UK. The company’s R&D laboratory remains in the UK. Following completion of the sale, which has the approval of all its shareholders, BioVex will become a wholly-owned subsidiary of Amgen.