Forma Therapeutics has built itself brick by brick with a drug discovery engine that has caught the eye—and the dollars—of industry titans like Celgene (NASDAQ: [[ticker:CELG]]), Boehringer Ingelheim, Genentech, and Johnson & Johnson (NYSE: [[ticker:JNJ]]). Now, it is putting that cash to work in a new collaboration with academic researchers.
Watertown, MA-based Forma is announcing a partnership today with Cancer Research Technology Ltd., the commercial arm of London’s Cancer Research UK, the largest cancer charity in the U.K. The deal is part of a large plan by Forma to do similar-style partnerships, but it boils down to this: A team of CRT investigators will gain access to compounds developed by Forma with the goal of discovering therapeutics that target a class of enzymes implicated in the emerging field of protein homeostasis.
“We’re looking to exploit the integration of our drug discovery engine together with very carefully selected teams of academics that can really help drive the science once we can provide tool compounds into their labs,” says Forma CEO Steven Tregay.
The deal is the first step in a broad initiative that Forma began on June 18 that it refers to as its “Asset Discovery and Development Company,” or “ADDco,” platform. Through the ADDco plan, Forma is using some of the cash from its various big-money partnerships to create virtual companies—ADDco’s— holding intellectual property rights to one, or even several drugs. Forma can then use those ADDcos as chips to create returns for itself and its investors through lucrative partnerships, sales, or otherwise. By taking advantage of its structure as a limited liability company, or essentially a holding company, Forma can easily hive off these entities when the time comes, while keeping its core drug discovery team intact.
“It allows us to sell the stock of the company, and that allows a more efficient distribution of the liquidation of that to the shareholders,” Tregay says. “In this case, the shareholders would be the institutions and Forma and its shareholders together.”
Forma is scouring the globe for specific academic and not-for-profit institutions to collaborate with. Its hope is that the researchers it taps can make drugs out of its compounds in areas it wants to target—in the near term, oncology and rare genetic disorders, Forma says—and then house each drug created by each partnership in an ADDco. Forma can then either dangle that ADDco in front of interested potential pharmaceutical partners or acquirers, keep it to develop on its own, or even consider taking it public, according to Tregay.
“We try to have some very generic mechanisms, but we really try to make sure that our partners feel that there’s a very close alignment with sharing in the economic upside,” he says. “I feel that that’s very important, because it creates a very strong alignment towards value creation.”
The structures of these ADDcos will vary. Forma will share
