Odyssey Thera announced this week a new, undisclosed equity financing round that the firm said it will use on R&D.
Merck, which led the round with existing investors Burrill, HBM Partners, and Healthcap participating, will play an “expanding“ role as an Odyssey collaborator around Odyssey’s cell-based assay technologies, Odyssey Thera CEO John Westwick told CBA News.
He said that Odyssey also plans to use some of the infusion to hire people “on the business side, which is an area that we have not expanded for some time, because we have been so focused on developing the cell-based assay platform,” which is based on protein-fragment complementation.
Merck was “very keen” to work with Odyssey and expand the collaboration, Westwick said. As part of that expansion, Merck “decided to make a significant investment in Odyssey in conjunction with this new round of financing.”
Cell-based assays will play a fundamental role in Odyssey’s collaboration with Merck. “Odyssey has really continued to focus on our core capabilities and core expertise, which is knowledge of cellular pathways and the ability to build these novel assays around pathways, both in number and in scope that are not achievable without our technology platform,” said Westwick.
“The most important thing that we have built over the last two years, and quite frankly, the most important thing in all of our partnerships, is the knowledge of cellular pathways,” he said. “The richness of the high-content assays themselves, the diversity of assays that we have looked at, and the vast amount of chemical space that we have covered, taken together, form the foundation of our strategy going forward.”
He said that Merck’s investment has opened a slot on Odyssey’s board for Alan Sachs, vice president of RNA therapeutics for Merck Research Laboratories.
“We are definitely going to execute and expand our alliances with a select number of major pharmas.”
Having a Merck representative on Odyssey’s board “will certainly facilitate our expanded interaction, and will streamline that whole process,” Westwick said.
Odyssey’s protein-fragment complementation assay platform can be used to probe signaling pathways and to screen for compounds that act on disease pathways without causing off-pathway effects, and the equity investment is intended to help the company continue to add to its stable of assays, drug targets, and cellular pathways. Its business model is focused on assay development, compound profiling, and drug discovery.
Westwick said the company does not focus on “a straight fee-for-service compound-profiling application. That is not the direction in which we are headed.” Rather, Odyssey is looking to enter into collaborations with pharma companies.
This is the first tranche of the round, which will remain open until the end of the year, said Westwick. He declined to specify the amount of money raised, because the round is still open.
“Upon final close of this round, I imagine that we’ll [announce] the total amount raised,” he said. “We are definitely going to execute and expand our alliances with a select number of major pharmas.”
For example, Odyssey is expanding “in a significant way” its alliance activities with Merck. Odyssey has worked with Merck over the last several years. “We were originally contacted by Merck Capital Ventures,” which was fairly recently swallowed up into the Merck parent organization, said Westwick.
Beside its deal with Merck, Odyssey is currently involved in an ongoing collaboration with Pfizer, which began in September 2006 following the successful completion of two prior collaborations with the drug maker.
Last December, Odyssey received an undisclosed royalty payment for reaching two milestones in that collaboration (see CBA News, 12/14/07). Odyssey is also currently working with Abbott (see CBA News, 4/13/07) and is “certainly looking to expand those collaborations,” according to Westwick.
Odyssey is also focused on its own assay, cellular pathway, and target development. “The technologies that have been validated by our pharma partners are being applied to a certain extent for our own product development, and continuing to build out the core technology which, although it has already been validated, there is more work to be done there,” Westwick said.
“The executive management staff that I [will hire] will really work on these product opportunities, and on these integrated alliances that we have with major pharma companies,” he said.
Odyssey’s collaboration with Merck covers several therapeutic areas and broad technology areas of interest to Merck, said Westwick. He declined to elaborate.
“Beyond that, I think that Merck likes to keep these things confidential,” he said.
Westwick also said that he expects Odyssey and its partners, including Merck, to deploy its technologies more broadly in their drug discovery and drug development efforts. “That has been our strategy with our other partnerships, and we intend to expand on that.”