Infinity Pharmaceuticals, a pioneer in the field of chemical genomics small molecule drug discovery for cancer, is to merge with publicly traded Discovery Partners International (DPI), based in San Diego.
The agreement provides a way for Infinity—as the new company will be known—to quickly reach the public markets, less than five years after its launch. The new company, which will focus on cancer drug discovery and development, will trade on the NASDAQ exchange under the symbol ‘INFI’.
"With the financial resources provided by this transaction, Infinity will be well positioned to create substantial value for patients and stockholders," said Steven Holtzman, chairman and CEO of Infinity
The deal makes “enormous sense,” Holtzman said during a conference call to announce the merger. “We have a robust pipeline, which addresses important unmet medical needs.” Infinity has a lead drug candidate in Phase I clinical trials, a second candidate poised to enter the clinic, and partnerships with Novartis, Johnson & Johnson and Amgen.
Speaking of Infinity’s chemical genomics platform, Holtzman said: “This drug discovery engine is responsible for all our proprietary product candidates. This merger is a creative and cost-efficient means by which Infinity gains access to public markets and the necessary capital to pursue development of important new medicine.” Holtzman says Infinity aims to have at least one new drug enter clinical trials each year over the next several years.
Michael Venuti, acting CEO of DPI, explained that the merger decision arose out of harsh economic realities facing DPI. This year, DPI’s major small-molecule library deal with Pfizer expired, leaving DPI with two choices: either identify new sources of contract revenue or leverage existing technology platforms.
During negotiations with Pfizer, “price was the first topic,” said Venuti. “Library prices had become so commoditized, [it was a] zero margin, negative margin proposition that cut us out of our most profitable business.” Venuti said that other parts of DPI still earn respectable revenues, “just not enough to sustain a public company.” He added: “We believe the future for Infinity is among the brightest in the biotech industry.”
The merger agreement has been approved by both companies' boards of directors and will need to be approved by both companies' stockholders. Once the merger is completed, Infinity stockholders will own approximately 69 percent of the new company.
Among drugs under development at the new Infinity are:
- IPI-504 -- Infinity's lead anti-cancer drug candidate, which selectively inhibits Heat Shock Protein 90 (Hsp90) in cancerous cells. The drug is being evaluated in two Phase I trials for relapsed multiple myeloma and gastrointestinal stromal tumors. A Phase II study should be launched before the end of this year,
- IPI-609 -- Infinity's second anti-cancer agent, in late-stage preclinical research. IPI-609 selectively inhibits the Hedgehog pathway, involved in several deadly cancers, including pancreatic cancer, small cell lung cancer, and metastatic prostate cancer. Infinity plans to file an IND for IPI-609 later this year.
- Inhibitors directed to the BCL2 family of proteins, key regulators of apoptosis, currently in preclinical development against a range of solid tumors. Last month, Infinity entered into an alliance with Novartis to collaboratively develop drugs targeting BCL2 protein family members for cancer.
Infinity employs about 100 staff, or as Holtzman calls them, “citizen owners.” Together with president and CSO Julian Adams and chief business officer Adelene Perkins, Holtzman will assume management of the newly company. Among the co-founders are Broad Institute director Eric Lander, Harvard’s Chair of Chemistry and Chemical Biology Stuart Schreiber, and former National Cancer Institute director Rick Klausner.
DPI offered collaborations and services for biopharmaceutical companies in the arena of small molecule and natural product drug discovery. As part of the new NIH Chemo-Genomic Roadmap initiative, DPI’s Compound Management Facility in San Francisco provides small molecules under contract to the NIH. This operation will continue, even as DPI seeks to transfer ownership of its drug discovery services units in San Diego, Basel and Heidelberg to organizations that will assume its existing service commitments.