UON biotech startup sells for $502 million
In what is now one of the biggest biotech transactions in Australian history, Viralytics – an oncolytic virotherapy firm originating from the University of Newcastle based on the work of Associate Professor Darren Shafren and his team, has been acquired for $502 million by world-leading pharmaceutical company, Merck.
On completion of the transaction, US based Merck will gain full rights to Viralytics’ experimental immunotherapy compound – CAVATAK® – a form of common cold virus which infects and kill cancer cells. CAVATAK is currently being studied in multiple Phase I and Phase II clinical trials.
University of Newcastle Senior Deputy Vice-Chancellor (Research and Innovation), Professor Kevin Hall, said this historical buyout was indicative of the University’s formidable track record of turning world class research into commercial opportunities.
“An achievement of this magnitude demonstrates that this is a region that is capable of developing a start-up business to a global scale.
“This outstanding achievement by Professor Shafren demonstrates not just excellence in research, but the sense of entrepreneurship and innovation that is part of the DNA of our institution,” said Professor Hall.
It culminates more than 20 years of development by Associate Professor Shafren, supported since inception by the Hunter Medical Research Institute (HMRI*). Newcastle Innovation, the University’s tech transfer arm, also facilitated Viralytics’ early funding.
Associate Professor Shafren said he looked forward to the opportunity to further advance vital biotechnology therapies.
“The basic premise of CAVATAK is to cause cancer cells to rupture and die, while also stimulating a wider immune system response in the body.
“Under this acquisition, Merck have committed to build on the science behind CAVATAK developed through trials in melanoma, lung and bladder cancers. I am eager to see that progress and ultimately to see positive outcomes for cancer patients worldwide,” said Associate Professor Shafren.
Dr Malcolm McColl, Managing Director and Chief Executive Officer for Viralytics, said the company was “proud to have progressed CAVATAK to this stage and believed that Merck was best suited to advance the formula and fully realise its potential for the benefit of patients globally.”
In congratulating Viralytics, HMRI Director Professor Michael Nilsson said that transforming good ideas into commercial realities required vision, expertise, dedication and a fertile research environment.
“Game-changing advances like this emerge quite suddenly in the health sphere when you provide the right research foundations combined with the support of donors,” he said. “Our model of translational research aims to clear the way for innovative therapies like this to be developed efficiently and affordably.”
Professor Hall commended Associate Professor Shafren for his role in fostering a sense of innovation among emerging researchers.
“Through Associate Professor Shafren’s expert mentoring, his wider team of higher degree research students have also been exposed to this process, helping to impress invaluable commercial and entrepreneurial acumen upon the next generation of research leaders.”
The Greater Building Society (now Bank) supported the venture for ten years, starting in 1999 with just $25,000 in seed-funding following the inaugural HMRI gala dinner. Bioscientific research continues to be performed at the University of Newcastle and HMRI.
Dr Darren Shafren is Associate Professor of Virology in the Faculty of Health, University of Newcastle, based at the Hunter Medical Research Institute and leading a staff of 20 scientists and research personnel.
* HMRI is a partnership between the University of Newcastle, Hunter New England Health and the community.