After leading California biotech companies to successful acquisitions, three life sciences entrepreneurs are attempting a second act in San Diego with 858 Therapeutics, a startup that aims to deliver precision therapies to fight cancer.
This week, the company led by Jeffrey Stafford, James Veal and Gretchen Bain emerged from stealth mode with an initial $60 million investment led by Versant Ventures.
The money will be used to build a portfolio of small molecules targeting certain proteins that modify RNA. These modifications have been identified as playing key roles in numerous forms of cancer.
“We are confident that 858 is well-positioned to capitalize on recent scientific discoveries in the field of RNA modification and translate them into a pipeline of drug candidates,” said Clare Ozawa, Ph.D., and managing director at Versant. “Moreover, we are very pleased to again be working with Jeff, Jim, and Gretchen on a new company, given their proven track records in achieving successful outcomes for patients, employees and investors.”
Stafford, Veal and Bain held top jobs at Jecure Therapeutics, Quanticel Pharmaceuticals and Amira Pharmaceuticals — all of which were backed by Versant. They have been involved in the discovery of more than 20 treatments that advanced to clinical trials, including approved drugs Votrient and Nesina.
Jecure was purchased by Genentech in 2018 for an undisclosed price. Celgene acquired Quanticel in 2015 for $100 million in cash, plus millions more if certain milestones were hit down the road. Amira merged with Bristol-Myers Squibb in 2011 for $325 million upfront and $150 million in possible milestone payments.
To jumpstart its current work, 858 Therapeutics acquired New York-based Gotham Therapeutics for an undisclosed price. Versant Ventures also was the lead investor in Gotham’s $54 million Series A funding round in 2018.
858 Therapeutics is headquartered in San Diego but will have lab operations both in San Diego and New York City, according to the company. It plans to expand to about 40 workers within the next 18 months.
Versant was once known for its build-to-buy business model, where it invested in biotech startups that did early development work and then were sold to a pre-arranged buyer if the fledgling drugs showed promise. But over the past five years or so Versant has pivoted to a variety of investment strategies, including backing stand-alone startups on a path toward going public.
New Enterprise Associates, Cormorant Asset Management and Logos Capital also participated in 858’s funding round.
“858’s discovery platform provides a unique opportunity to interrogate this novel area of biology and make an impact for patients with intractable forms of cancer,” said Ali Behbahani, general partner at New Enterprise. “We look forward to working with management to translate these recent discoveries into a pipeline of important therapeutics.”