Kronos Bio had a rough end to 2022 after having to toss away a late-stage acute myeloid leukemia asset. But 2023 is already looking a bit brighter thanks to a new small-molecule drug discovery pact with Roche’s Genentech.
The companies will collaborate on an initial two drug discovery programs in oncology, with each one focused on a transcription factor chosen by Genentech. Transcription factors are believed to provide the seeds for cancer initiation, progression, spread and resistance, so scientists want to develop inhibitors of these proteins that can turn off the mechanism.
Genentech will pay out $20 million upfront, with preclinical, clinical and regulatory milestones that could top $177 million for the first program and $100 million for the first licensed product. The deal also includes royalties.
Kronos said in a Monday release that the 24-month deal could reach $554 million if all milestones are met, although specific financials were only noted for the first two programs in a related Securities and Exchange Commission filing. The goal is to develop small-molecule candidates ready for preclinical testing, Kronos said in the filing. Kronos will handle the discovery work using its proprietary drug discovery platform and research already conducted at Genentech. The Roche unit will then have the exclusive right to conduct preclinical and clinical testing then commercialization on any candidates it chooses.
This is the first collaboration for San Mateo, California-based Kronos, CEO Norbert Bischofberger, Ph.D., said in a statement. It comes at a crucial time for the biotech which, in November 2022, walked away from late-stage acute myeloid leukemia drug entospletinib. Kronos blamed enrollment challenges in the phase 3 trial for the decision to discontinue rather than any sort of adverse events or lack of efficacy that doomed many a trial in 2022.
It’s a small deal, at least compared to the blockbuster biobucks blank checks that have been written by some Big Pharma peers in recent weeks. See Amgen, Moderna and Merck & Co. Even Roche put up a potential $1.1 billion in an extended licensing pact with its spinout Nimble Therapeutics to discover new peptide therapies last week.
But every dollar counts, and Kronos said the deal will help extend its cash runway into the second half of 2025. As of the end of the third quarter, the runway of $270.3 million was projected to end after the second quarter of that year.