Why Early-Stage Dealmaking is Hot
Big Pharma is in-licensing increasing numbers of preclinical and Phase I compounds despite the fact that their own early-stage productivity is up. Their goal is to increase shots on goal; to pay for the ballooning costs, however, they're increasingly willing to share downstream rights for near-term help on expenses.
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An extraordinary series of high-value IND-stage deals could help to solve what has always been the intractable problem for biotechs: how to fund late-stage product development and simultaneously re-fill the early-stage pipeline. Still, it will be the rare biotech that can pull off this strategy--which requires INDs in the hottest areas of pharmaceutical development.
Europe's summertime flurry of private biotech sell-offs points to growing pragmatism among management and VCs, and still-poor valuations on the public markets. Firms which haven't already considered the trade sale opportunity should do so--even early-stage, pre-product platform groups.
From its start as a promising powerhouse in the emerging area of regenerative medicine and through product failures, valuation crunches and capital constraints, Curis has in the past two years embraced an almost old-school approach to the biotechnology business. Bereft now of the late-stage assets (and corresponding cash burn) that helped drive its formation through merger in 2000, the company has leveraged its preclinical expertise in cell signaling to sign broad, value-creating alliances with top-shelf biotechnology and pharmaceutical partners.