fb-pixel Skip to main content

Casebia, a Cambridge biotech, will no longer be an independent company

Less than four years after it was founded by the German drug and chemical giant Bayer and a Swiss gene-editing company, the Cambridge startup Casebia Therapeutics plans to close as an independent entity.

Casebia, which had a pledge of up to $335 million from Bayer to create drugs to cure blood disorders, blindness, and other genetic disorders, will be absorbed by its other cofounder, CRISPR Therapeutics, under a plan announced Monday.

Bayer will retain an option to help develop two drugs created by Casebia.

The restructuring deal is expected to close by the end of the year.

Bayer, CRISPR, and Casebia issued a news release four days after Bayer officials repeatedly declined to say whether Casebia was still in business. The Globe made inquiries after learning that Casebia employees had left or were working at CRISPR.

Advertisement



Bayer and Casebia characterized the restructuring as good news.

“I think the structural change is just a natural evolution,” said Samarth Kulkarni, CEO of CRISPR and chair of Casebia’s board of directors. “If anything, these programs are going to move faster within the CRISPR construct.”

Although CRISPR is based in Zug, Switzerland, the gene-editing firm has research and development operations at 610 Main St. in Cambridge, the same building where Casebia’s more than 60 Massachusetts employees work. Casebia also has about 20 employees in San Francisco.

Kulkarni acknowledged that Casebia’s board had not long ago discussed the firm going public, but that never materialized. Casebia issued its last previous news release on July 8. Its CEO left without another job in September, and its head of legal affairs recently joined Stoke Therapeutics, a Bedford biotech.

Kemal Malik, a member of Bayer’s board of management, said in the latest news release that CRISPR has “built the capabilities and expertise necessary to advance the Casebia programs to the next phase of development, and we look forward to continuing our collaboration with them.”

Advertisement



Casebia will “operate under the direct management” of CRISPR in the new setup, the release said. A small number of Casebia employees have already begun working at CRISPR, Kulkarni added.

“We would like to retain as many people as we can,” he said. “We’re trying to work through all this.”

Although neither Bayer nor CRISPR mentioned outside factors in the news release, it’s no secret that Bayer has been slashing costs.

Last November, Bayer said it was cutting 12,000 jobs worldwide — about 10 percent of its workforce — in an attempt to soothe Wall Street, which was alarmed by a mountain of lawsuits the company had inherited in its $63 billion acquisition of Monsanto last year. Thousands of people have filed suits against Bayer over Monsanto’s signature weedkiller, Roundup, saying the popular herbicide caused cancer.

In the three months before the layoffs announcement, Bayer’s market value had plunged about $34 billion after a California jury found that Roundup may have caused a school groundskeeper’s cancer.

Analysts have estimated that settling all the Roundup-related lawsuits in the United States could cost Bayer from $2.5 billion to $20 billion, according to a recent Bloomberg News report.

Jim Burns, who stepped down as CEO of Casebia last month, said he was unaware of any link between Bayer’s litigation woes and the end of Casebia as an independent entity. “To my knowledge, it had nothing to do with it,” he said.

Advertisement



Casebia opened with considerable fanfare in 2016, leasing about 33,000 square feet of laboratory and office space in Cambridge. It had received a commitment of up to $300 million from Bayer over five years. Bayer also ponied up an additional $35 million for its stake in the startup, which it owned 50-50 with CRISPR.

Bayer had provided $160 million to the venture through the end of last year, according to CRISPR corporate filings. Bayer will retain no ownership of what was Casebia after the deal closes.

CRISPR contributed its CRISPR-Cas9 gene-editing approach to the venture while Bayer provided its protein engineering expertise and “disease know-how,” according to the companies’ announcement of the partnership.

CRISPR Therapeutics is one of several startups in Massachusetts focusing on treating and, potentially, curing diseases through gene editing. That technology seeks to insert, delete, or modify DNA, which some scientists have hailed as the biggest biotech discovery of the century.

When Casebia was officially launched in August 2016, Rodger Novak, cofounder of CRISPR Therapeutics, said the goal was to bring three to four hematology and ophthalmology programs to clinical trials within five years. Among the diseases the company had targeted is hemophilia.

It was unclear how far Casebia has advanced in meeting Novak’s goals, but Burns, the former Casebia CEO, said, “We made very good progress on all of our therapeutic areas.”

In addition to CRISPR Therapeutics, at least three other startups in Cambridge — Editas Medicine, Intellia Therapeutics, and Beam Therapeutics — are working on gene-editing.

Advertisement



The Casebia joint venture was the first investment by the newly established Bayer LifeScience Center. When he announced the partnership, Dr. Marijn Dekkers, then-CEO of Bayer, said that Bayer and CRISPR were “philosophically and financially aligned in our mission to develop game-changing or possibly curative treatments.”

Bayer’s other joint ventures include two other Massachusetts startups, BlueRock Therapeutics and Joyn Bio.

Like other big multinational drug makers in recent years, Bayer evidently felt that raising its profile in Massachusetts’s robust biotech hub was essential to pursue cutting-edge science and to recruit talent.


Jonathan Saltzman can be reached at jsaltzman@globe.com.