Tübingen spin-out Immatics raises €53.8M for cancer vaccines

Half of the latest round came from existing investors, the German venture capital firm Wellington Partners and dievini Hopp Biotech Holding, the investment firm belonging to software entrepreneur Dietmar Hopp, with the other half coming from the public venture fund MIG Verwaltungs AG and another family investment firm AT Impf GmbH.

The total amount raised since Immatics was formed in 2000 now comes to well over €100 million, a level of funding to which few private European biotechs can aspire. This is especially the case for companies blazing a trial in novel areas of technology like cancer vaccines.

Indeed, Paul Higham, CEO of Immatics told Science|Business he would have liked to attract new venture capital backers from elsewhere in Europe and the US, but those he approached were too risk-averse. Sentiment has shifted since the US company Dendreon won FDA approval to market the first cancer vaccine, Provenge, for treating prostate cancer, in April, but Higham said, “When we talked to VCs before the Dendreon approval, there was a lot of skepticism about cancer vaccines.”

Not only that, Higham concluded it was not worth trying to convince them. “VCs are screwing down valuations and turning people off,” he said.

AT Impf is the investment arm of a fund representing Thomas Strüngmann and his brother Andreas Strüngmann, who made €5.65 billion in cash when they sold generic drug maker Hexal AG, of Holzkirchen, Germany, to the Swiss pharmaceutical company, Novartis AG in 2005. The Strüngmann brothers have since joined Hopp in becoming leading biotech investors and important props of the sector in Germany.

So, in April the brothers put €55 million into AiCuris GmbH, a spinout of Bayer HealthCare AG, which is developing new antibiotics. They are also behind BioNTech, a company formed in 2008 as a spin-off from Johannes Gutenberg University in Mainz, with a brief to take on and develop novel and risky technologies such as RNA vaccines and cancer immunotherapies.

In addition, the Strüngmanns are majority owners of Ganymed Pharmaceuticals, a 2001 spin out from the universities of Zurich and Mainz, backing the company when it raised €65 million in a fourth round of funding in November 2008. Thomas Strüngmann is also an investor in MediGene GmbH.

Meanwhile, Hopp’s investment firm has also taken a keen interest in biotech. It is currently supporting a rights issue by Agennix AG, a company formed last year from the wreckage of GPC Biotech, which ran aground when its lead product satraplatin failed to get European marketing approval.

Earlier this year, in May, Hopp’s firm put €27 million into CureVac GmbH, another Tübingen University spin-out and specialist in cancer vaccines. Hopp is also majority owner of Sygnis Pharma AG and an investor in Apogenix GmbH and Wilex AG.

The Dietmar Hopp Foundation has also been involved in the development of the Rhine-Neckar biocluster, centred on Heidelberg.

Despite the huge amounts of money that Hopp and the Strüngmanns are providing for development-stage German biotechs, Higham noted that Immatics is the first company in which they have co-invested.

Armed with the new funding, Immatics will start a Phase III trial of it renal cancer vaccine later this year. If the results are positive, Higham believes this will support approval of the product in both Europe and the US.

The approval of Provenge was the sign that cancer vaccines have finally rounded the home straight, Higham said. “It’s a halo effect: the question is, how to make the immune system work in combating cancer; Dendreon has got there and done it, despite all the setbacks on the way.”