After years of working quietly on its own, a Waltham-based company has received the powerful backing of one of the world’s largest drug companies to bring a new class of medicine to market.
Arrakis Therapeutics signed a licensing agreement with Roche on Wednesday worth $190 million in upfront payments to the privately held startup. The deal gives the Swiss pharmaceutical giant exclusive rights to develop drugs for difficult-to-treat diseases, such as cancer.
“I’m really excited about this,” Arrakis chief executive Michael Gilman said in an interview. “We had the occasional dark day, but then things changed and we were like ‘Oh my God, we have a tiger by the tail here’ — working with a partner like Roche is a fantastic outcome for us.”
Cancer is among those diseases where it has been difficult to get drugs to bind directly to targeted areas inside cells. But Arrakis is trying to develop small molecule drugs, which could be administered via pills, that bind to RNA, or ribonucleic acid, in an effort to essentially turn off disease-causing genes.
“When we started, most people thought that we were out of our minds, they thought it was impossible,” Gilman said. “Obviously, we did not believe it was impossible, or else we wouldn’t have done it, but we knew it was going to be hard.”
When Arrakis was founded in 2015, potential partnerships — especially those of Roche’s magnitude — were not a realistic business possibility.
“We kept our heads down and didn’t talk to pharma partners, partly because we didn’t know if it would work,” Gilman said.
But about a year ago, Arrakis began seeing positive results from its research, and Gilman said the company found that there were over 100 possible drugs worth pursuing. The 38-person team in Waltham couldn’t possibly develop all of them by itself.
“If our commitment here is to see as many medicines as possible get developed off our platform, we needed to find a partner to leverage what we have done,” Gilman said. “I really think there is an opportunity to generate dozens and dozens of medicines off of this platform, and that is why a partnership with a company like Roche is just so important.”
One of the biggest pharmaceutical companies in the world, Roche has a vast portfolio of cancer drugs.
Under the terms of the agreement, Arrakis will continue to lead research and discovery efforts for drugs up until a certain point, at which time Roche will have the opportunity to take further steps in preclinical and clinical development.
In addition to the upfront payment of $190 million in cash, Arrakis could receive preclinical, clinical, commercial, and sales milestone payments and royalties for resulting products.
The company has previously raised more than $113 million in venture capital over two funding rounds. Now, with the Roche partnership, Arrakis is working to double its Massachusetts workforce, although for now those efforts must happen remotely because of COVID-19.
“This week we had our first new employee who was remotely on-boarded,” Gilman said. “We shipped a laptop to her house and had a company Zoom call where we all got to meet her for the first time on video — it’s weird, but everyone is dealing with it and people are trying to have some fun with it.”