January 27, 2012: Genentech and Constellation Pharmaceuticals have established a strategic agreement in the areas of epigenetics and chromatin biology to discover and develop innovative treatments for cancer and other serious diseases. Under the terms of the agreement, Constellation will receive committed funding of $95 million, comprising an upfront payment and research funding for a three-year collaboration period. Constellation will be eligible for substantial development and commercialisation milestone payments as well as up to double-digit royalties on commercial sales of multiple products by Genentech. Additionally, Constellation will retain exclusive development and commercialisation rights to selected programmes emerging from the collaboration, for which payments would be due to Genentech upon the successful commercialisation of such products.
The companies will establish a research collaboration addressing multiple epigenetic target classes. Constellation will retain independent strategic direction, operational management and exclusive rights to programmes outside the scope of the collaboration, including its two most advanced programmes focused on the development of inhibitors of the BET chromatin reader and EZH2 chromatin writer proteins.
Genentech has a future option to acquire all outstanding shares of Constellation based on pre-negotiated terms, which include a significant initial acquisition payment plus contingent value rights payments based on the future successful development and commercialisation of multiple products by Genentech. The company’s option to acquire Constellation includes the BET and EZH2 programmes as well as others outside the collaboration.
Drug development in the field of epigenetics is directed towards the identification of small molecules that inhibit the activities of proteins (epigenetic regulators) that add, remove or recognise various chemical modifications to specific sites on DNA or chromosomal proteins. These marks play a key role in determining whether a gene is on or off. Epigenetic regulators are often referred to as writers (add modifications), erasers (remove modifications) and readers (bind to chromatin). Research at Constellation and by others has shown that abnormal epigenetic regulation contributes to many different diseases. Constellation Pharmaceuticals is applying insights from epigenetics to discover and develop small molecule therapeutics for the treatment of cancer, inflammatory/immunologic disorders and other diseases. The company’s product discovery engine targets both the enzymes that modify the dynamic structure of chromatin and other proteins that interact with chromatin to control gene expression.
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