Roche Backs Aileron's Stapled Peptide Technology in $1.1 Billion Deal

Roche Holding (RHHBY), the Swiss pharmaceutical giant and the world's largest maker of cancer drugs, said Tuesday it is entering a deal with U.S.-based Aileron Therapeutics worth up to $1.1 billion to gain access to a new class of drugs called stapled peptide therapeutics.

Cambridge, Mass.-based Aileron is set to get an upfront payment of $25 million and up to $1.1 billion in payments if drug candidates are successfully developed against five targets, as well as royalties on any future sales. The five undisclosed targets will be selected from Roche's key therapeutic areas, which include oncology, virology, inflammation, metabolism and central nervous system.

Attacking Intractable Disease Targets

One of the challenges in creating treatment is sometimes the drug's ability to reach and penetrate its target cell. Aileron is working on a technology that can help deliver the drugs.

Aileron aims to develop a stabilized peptide, a small protein. It's doing so by "stapling" the peptide into an alpha-helical shape, which optimizes its ability to link and penetrate the cells, as well as stay active longer. The stapled peptide can therefore help a drug penetrate a cell and remain stable after entry to ensure effective treatment of the patient.

The deal with Aileron should help Roche develop a new class of drugs that are based on Aileron's technology and become a potential solution for drugs of intractable disease targets.

"This collaboration with Aileron is a strategically important endeavor for advancing a novel approach to developing new medicines and will accelerate our progress toward our ultimate goal of bringing important new treatments to patients with unmet medical needs," Jean-Jacques Garaud, Global Head of Roche Pharma Research and Early Development said.

The work was in an early stage and clinical trials could start in about three years, Roche spokeswoman Claudia Schmitt told Reuters.

Avastin Rebuffed Again

The news Tuesday comes after Roche agreed on Monday to buy U.S.-based BioImagene for some $100 million to increase its already dominant position in tissue-based cancer diagnostics.

Also Tuesday, Roche for the second timefailed to win the backing of U.K. regulators for Avastin -- its top-selling drug -- in metastatic colorectal cancer patients on cost effectiveness reasons. "We are disappointed not to be able to recommend bevacizumab, but we have to be confident that the benefits justify the considerable cost of this drug," National Institute for Health and Clinical Excellence CEO Andrew Dillon said in the statement. NICE will make a final recommendation on Sept. 15.