Editor’s note: BioWatch is a regular feature on Fridays.Merix Bioscience considered two quite different options before deciding to sell a specific use of its technology to California-based Geron this week.
Clint G. (Skip) Dederick, Jr., chairman and chief executive of Merix tells Local Tech Wire, “Behind the story out there now is the fact that we had two quite different types of options. Both were attractive and it was a tough decision.”
Dederick won’t say much about the spurned suitor, other than it is a large multi-national company. “The nice thing is that two different companies were validating our technology and approach. We had to pick one at this time and the board and investors voted for Geron.”
The Merix technology helps the body’s immune system recognize and attack tumor cells or viruses. Investors recognize its potential and have poured $54 million into the company, including a record-setting $40 million round in 2001. In February, Merix took a $12 million bridge loan. Durham-based Aurora Funds and Intersouth Partners are backers.
Dederick says that by choosing to sell exclusive rights to Geron for stock valued at $43 million, Merix in some sense creates a competitor. “But there’s only so much money Merix and Geron can raise and it’s not enough to do everything this technology can do,” he says.
“Between the two of us, we’re going to find lots of uses for this technology. This deal is not the be-all and end-all of this company.”
Merix sold exclusive rights to Geron to use its platform with telomerase, an enzyme found in most cancer cells. Telomerase, which is associated with cancer’s uncontrolled growth, is one of the few defined universal cancer antigens, making it an ideal target for the Merix-Geron therapies being tested on prostrate cancer patients in clinical trials at Duke. An antigen is a substance the immune system recognizes as foreign and attacks.
A therapy effective against telomerase, which is found in most cancer cells and not in most normal ones, is likely to be effective against a broad range of tumors.
Geron wanted to nail down rights to the Merix technology, which it’s using in the Duke prostate cancer trials. Dederick says it still leaves Merix with plenty of things to put in its beakers and test tubes.
For one thing, Dederick points out, “There aren’t that many defined antigens known.” He believes researchers will eventually find “a whole series of them” going forward.
The company also sees great potential from its total tumor RNA therapy, which takes RNA from a patient’s cancer and makes cancer specific tags for the immune system to target. One early study, which he says “wasn’t ideal gave us a nice warm feeling because it showed it was extending life. That’s more expensive data than what Geron just paid $43 million in stock for,” Dederick says.
Powerful HIV therapy
One Merix project Dederick seems genuinely excited about is the company’s unique approach to treating HIV, the virus that causes AIDS. “We’re the only company I know of coming at it in a personalized approach this way,” he said.
The treatment would take genes from a patient’s HIV strains, make multiple copies, then use the Merix technology to tag the patient’s viral proteins so his immune system attacks them.
“I’ve never seen anything this powerful before,” says Dederick. “It’s still very early. We haven’t finished pre-clinical work on human blood samples yet.”
If it checks out, it could do a lot of good, Dederick says.
Merix has applied for more than $20 million from the National Institute of Health to fund further research of its gene-based AIDS vaccine, which undergoes safety tests later this year.
“We use so-called soft monies — government funding — to advance a lot of our projects before putting in lots of dollars,” Dederick says.
Dederick says the company plans to pace its growth slowly, adding management and employees gradually. He says the Merix board meets this month and unless they have other ideas, he plans to stay on as CEO of the company.