Cambridge biotech Tango signs $50m deal with drug giant Gilead
Tango Therapeutics Inc. has cut its first major business deal since debuting last year, a collaboration with the big California drug maker Gilead Sciences Inc. that will pay the Cambridge biotech $50 million up front.
Tango, a privately held firm developing a new generation of targeted cancer therapies using the latest advances in DNA sequencing, will work with Gilead to identify new immunotherapy targets. Immunotherapy relies on the body’s immune system to fight cancer.
Under an agreement to be announced Wednesday, publicly traded Gilead will have options to worldwide rights for treatments on up to five cancer drug targets identified by Tango.
Tango is eligible to receive an additional $1.7 billion if the collaboration meets certain goals for the development, approval, and sales of new medicines.
“This is a big deal for us,” said Dr. Barbara Weber, chief executive of Tango and an oncology expert. “It allows us to help develop our internal pipeline at the same times that we’re helping Gilead develop theirs, with each of us playing to its own strengths.”
Dr. John McHutchison, Gilead’s chief scientific officer, said Tango “has built a unique discovery platform that we hope will help create the next generation of cancer therapies.”
Tango was publicly launched in March 2017 with $55 million in funding from Third Rock Ventures, the Boston biotechnology venture capital firm.
Gilead, which is headquartered in Foster City in Silicon Valley, is one of the nation’s largest biopharma companies by sales and market value. It has focused primarily on developing and selling antiviral drugs used in the treatment of HIV, hepatitis, and the flu.
Four years ago, Gilead vaulted to the front ranks of drug companies with the debut of Sovaldi, a revolutionary hepatitis C therapy that cured many patients and generated billions of dollars in sales. Gilead soon launched another hepatitis C treatment, Harvoni, also a blockbuster.
The drugs were remarkably successful at curing patients of hepatitis C — maybe too successful for Gilead’s own good. As the number of hepatitis C patients fell, Gilead grappled with declining sales and profits. It also drew criticism for the cost of the drugs.
Massachusetts Attorney General Maura Healey warned Gilead in 2016 that the prices of the two hepatitis C medicines — Sovaldi, which costs $84,000 for a full 12-week course of treatment, and Harvoni, which costs $94,500 for a treatment regimen — “may constitute an unfair trade practice in violation of Massachusetts law” because they are too expensive for many patients.
Healey later reached a deal with Gilead to provide rebates for the care of some hepatitis C patients covered by MassHealth, the state’s Medicaid program.
Recently, Gilead has made forays into the development of cancer treatments. Last year, it bought Kite Pharma Inc., which is based in Santa Monica, Calif., for nearly $12 billion. Like Tango, Kite specialized in the emerging class of cancer immunotherapies.
Gilead has also made several deals with Massachusetts biotechs to bolster its drug pipeline.
In 2016, it bought a subsidiary of Cambridge-based Nimbus Therapeutics LLC in a deal valued at up to $1.2 billion. The subsidiary, Nimbus Apollo, was working on treatments for liver diseases.
Gilead also signed deals in 2015 and 2017 with Hopkinton-based Spring Bank Pharmaceuticals Inc. to collaborate on potential hepatitis B treatments. And Gilead announced a collaboration in 2017 with X-Chem Inc., a Waltham biotech using a new drug-discovery approach.