An experimental Alzheimer’s drug and its designer are getting a second chance.
On Tuesday, Sangamo announced it had partnered with Genentech to develop an epigenetic repressor to prevent the production of tau, a protein many scientists believe plays a more direct role in killing brain cells than the notorious amyloid protein.
The therapy was previously the centerpiece of a sweeping partnership Sangamo struck with Biogen in 2020. Sangamo, a gene editing company, got a whopping $350 million upfront and stood to earn up to $2.37 billion in milestone payments, but Biogen pulled out of the deal last year before the drug ever reached clinical studies.
Now Genentech will get to test out the tau-lowering drug, and a similar therapy for an undisclosed target, at a lower cost. It will pay Sangamo $50 million in near-term licensing fees and milestone payments and up to $1.9 billion in future milestones.
It’s a much-needed lifeline for the struggling California biotech, whose stock $SGMO is down more than 95% since its recent high at the end of 2020. At the end of March, the company said it only had enough funds to survive into the third quarter.
The nearly 30-year-old company has never had a drug approved, and a series of clinical setbacks and continually shifting priorities have soured investors. In a bid to stay afloat, Sangamo has laid off more than 360 employees — the majority of its workforce — across three restructurings since April 2023 and shuttered manufacturing and research facilities in California and France.
But in an interview with Endpoints News, CEO Sandy Macrae insisted that things are looking up. “This is a fundamental turning point for the company,” Macrae said. “We have validation from Genentech. We’re talking to several other people and would hope to announce other deals in the coming months.”
Sangamo will report second-quarter earnings after markets close today. Macrae said he plans to make a case to investors that the company can keep running until it earns milestone payments worth up to $220 million from its Pfizer-partnered gene therapy in hemophilia A. The pharma could file for approval at the beginning of next year.
A future for zinc fingers?
Times weren’t always so tough for Sangamo.
Long before CRISPR was invented, Sangamo was revered as the original gene-editing biotech. The company’s scientists pioneered zinc finger nuclease technology to make precise cuts in DNA. But the approach was never as easy to use as the readily reprogrammable CRISPR, and Sangamo has struggled to convince investors that zinc fingers, which it argues are safer and more precise, have a future.
“It is not possible for us to combat 30-odd CRISPR companies telling all the investors that they have the answer,” Macrae said. “However, we are certain our science is good and our medicines work, and we look forward to demonstrating this.”
Sangamo’s research efforts grew increasingly diverse over the years, including programs in cancer and rare disease. Macrae said that Sangamo has now shifted its focus to neuroscience, where it believes it will have a leg up on other gene editing companies that are largely focused on editing blood cells outside the body or liver cells inside the body.
Key to that strategy, and its Genentech deal, is a new AAV capsid, the viral particle that most gene therapy developers use to shuttle their treatments into the body. Existing AAVs aren’t great at getting into the brain, and Macrae said that delivery dilemma was a big reason why Biogen handed the programs back to Sangamo.
Numerous academic labs and biotech companies have been racing to discover or design better AAVs. Sangamo searched through millions of variants of the virus before revealing in March that it found a new capsid that was 700 times better at expressing genes in the brain than the standard virus.
For Genentech, which is part of Roche, the new partnership expands its clinical work in Alzheimer’s disease, which includes an amyloid-removing antibody designed to more easily get into the brain and a small molecule drug to prevent the buildup of amyloid.
Macrae wouldn’t say when a clinical trial of the tau-repressing therapy would begin.