Roche, already partnered with Poseida Therapeutics in the development of off-the-shelf cell therapies for blood cancers, is broadening its ambitions with the modality through a deal to acquire the biotech for $1 billion up front.
Applying allogeneic cell therapies to solid tumors and immunological indications are among the goals Roche aims to achieve by buying San Diego-based Poseida. According to deal terms announced Tuesday, Roche will pay $9 in cash for all shares of the biotech. That price represents a 215% premium to Posedia’s closing stock price on Monday. When Poseida went public in 2020, it priced shares at $16 apiece.
In addition to the upfront payment, the Swiss pharma giant has agreed to pay out up to $4 more in cash per share if certain programs achieve specified goals. These contingent value rights payments could bring the deal’s value to $1.5 billion.
Poseida is a clinical-stage developer of cell and gene therapies. It’s part of a contingent of companies aiming to advance on the first cell therapies, which are made from a patient’s own immune cells in a lengthy and expensive manufacturing process. The cells in Poseida’s therapies are sourced from healthy donors and engineered with the company’s non-viral technologies. Such allogeneic cell therapies could lower manufacturing costs and shorten production timelines compared to the manufacturing of autologous cell therapies.
In 2022, Roche paid Poseida $110 million up front for rights or options to the biotech’s blood cancer programs. Another $6 billion was tied to the achievement of milestones. Included in the deal were P-BCMA-ALLO1, an allogeneic cell therapy that targets the cancer protein BCMA to treat multiple myeloma, and P-CD19CD20-ALLO1, an allogeneic dual cell therapy that targets the proteins CD19 and CD20 to treat B-cell malignancies. Both are currently in the clinic and preclinical and early clinical data for these programs are set for presentation next month during the annual meeting of the American Society of Hematology. Roche likes what it has seen from Poseida’s research so far.
“We are very encouraged by the early clinical data, and this acquisition builds on our joint progress to catalyze the development of potentially first and best-in-class cell therapies in oncology, immunology and neurology,” Levi Garraway, head of product development and chief medical officer at Roche, said in a prepared statement.
Regarding immunological indications, Poseida recently submitted applications seeking FDA permission to begin clinical trials testing P-CD19CD20-ALLO1 in multiple sclerosis and systemic lupus erythematosus. Poseida’s research of non-viral delivery of genetic medicines to the liver is preclinical. One of these programs, P-FVIII-101, is an in vivo gene therapy in development for hemophilia A. Roche has a presence in this market through Hemlibra, a bispecific antibody for hemophilia A that has become a blockbuster product.
In a note sent to investors, William Blair analyst Sami Corwin said Roche and Poseida make for a strategic fit, given the pharma giant’s presence as an oncology leader, its investment in building a cell therapy manufacturing facility, and the potential synergies of Hemlibra with Poseida’s hemophilia A gene therapy. But the big payout to Poseida shareholders is tied to the more advanced allogeneic cell therapies.
The contingent value rights outlined in the deal call for payment of $2 per share in cash when the BCMA-targeting therapy starts a pivotal study in any indication by Dec. 31, 2028. A $1 per share payment is tied to the start of a pivotal study of either the BCMA-targeting therapy or the CD19- and CD20-targeting therapy for an autoimmune disease by Dec. 31, 2034. The final contingency payment is related to a commercial milestone. Poseida shareholders will receive $1 per share when P-BCMA-ALLO1 records its first sale as a treatment for any indication by Dec. 31, 2031.
Corwin said the first contingency payment will likely be achieved, given that the BCMA-targeting therapy is currently in Phase 1/2 testing and has generated encouraging clinical data, suggesting it will begin a pivotal study by the end of 2028. But the second contingency payment is higher risk given that neither candidate has reached the clinic in autoimmune disease. That said, William Blair believes 10 years is sufficient to advance from preclinical to pivotal testing if the early clinical studies are successful. Corwin said the third contingency payment is de-risked based on that program’s stage of development; William Blair models a commercial launch in 2028.
Poseida was previously partnered with Takeda Pharmaceutical on the development of non-viral gene therapies. The Japanese pharma giant terminated the pact, effective July 30, 2023. Soon after, Astellas Pharma made a $50 million investment in Poseida. Under the terms of that agreement, Astellas has the right to be notified if Poseida reaches a merger deal with another company. Astellas also has the right of first refusal to make a competing offer. This right expires 18 months following the closing date of the agreement, which would be Feb. 4, 2025.
The boards of both Roche and Poseida have already approved the acquisition agreement. The companies expect to complete the transaction in the first quarter of 2025.
Photo: Giuseppe Aresu/Bloomberg, via Getty Images
