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Cell therapy

GC Lab Cell, Artiva ink $1.9 bn deal with MSD

By Jan 29, 2021 (Gmt+09:00)

GC Lab Cell, Artiva ink />.9 bn deal with MSD


South Korea-based biotechnology company Green Cross Lab Cell Corp. (GC Lab Cell) and its US-based subsidiary have inked a $1.9 billion deal to export the latest cell therapy platform technology to the global biopharmaceutical company Merck Sharp & Dohme Corp. (MSD), the company announced on Jan. 29.

The news comes as a surprise considering that GC Lab Cell has been considered an underdog in the pharmaceutical sector as its endeavors to develop chimeric antigen receptors-natural killer (CAR-NK) cell therapy seemed out of reach. 

But the Korean company stunned the industry when it announced that it would be exporting its CAR-NK platform technology, co-developed with Artiva, to the US pharmaceutical giant. 

"This deal was not established on a specific new drug candidate. It was based on a platform technology that can be applied in many areas," said a GC Lab Cell official.

MSD, Artiva and GC Lab Cell will use the platform to co-develop CAR-NK cell therapies for three types of solid tumors.

Touted as the next-generation immunotherapy, CAR-NK cells recognize and destroy abnormal cells in the body. Natural killer cells are extracted from healthy donors' blood and added with CAR molecules, which then creates CAR-NK cells.

"It's a big deal that comes close to Fate Therapeutics' technology transfer, which was around $3 billion," said Heo Hye-min, an analyst at Kiwoom Securities. This is the third time for a domestic pharmaceutical company to snag a deal valued at over 2 trillion won. 

GC Lab Cell and Artiva will each take half of the $1.9 billion, estimated to be around $980 million. GC Lab Cell and its parent company Green Cross Holdings are also likely to receive dividends from Artiva as they each hold a 10.2% and 19.7% stake in the company, respectively.

PERSEVERANCE PAYS OFF

The pharmaceutical industry says GC Lab Cell's success is due to its ability to identify the market trend, make long-term investments, and actively engage in global partnerships.

GC Lab Cell determined that the time for CAR-NK cell therapy would arrive sooner than expected considering the pace of technology development. The company began developing CAR-NK cell therapy in 2014 when the earlier developed CAR-T cell therapy had yet to be commercialized.

CAR-T cell therapy is also a type of immunotherapy that takes a sample of a patient's T cells, a type of immune system cell, and modifies it to attack cancer cells. Kymriah was the first CAR-T cell therapy to receive US Food and Drug Administration (FDA) approval in 2017, just a little over three years ago.

"We've been researching NK cells since 2010 and we concluded that CAR-NK cell therapy would have a winning chance. So we decided to commit our efforts to the development process," said a company official.

Industry watchers explain that GC Lab Cell's approach of skipping CAR-T and heading directly to CAR-NK is similar to Hyundai Motor shifting its focus to developing hydrogen cars when the electric vehicle market became saturated.

The Korean biotech firm's commitment to long-term research and development also played a significant role in bagging the latest deal, as it would not have been possible without the management's decision to invest in an uncertain field for seven years.

GC Lab Cell has invested over 20 billion won ($18 million) to develop the CAR-NK cell therapy technology. It is uncommon for domestic pharmaceutical companies to spend millions of dollars in research without beginning clinical trials.

In addition to the company's commitment to research and development, GC Lab Cell's business decision to establish Artiva in the US was a game-changer and a radical approach compared to domestic companies that generally finalize the research at home before seeking overseas partners.

GC Lab Cell hired researchers from global biopharmaceutical companies, such as Fate Therapeutics and Bellicum Pharmaceuticals, who are well-versed and familiar with cell therapy to offer a streamlined process when transferring technology or carrying out joint-development with global firms.


Write to Sang-hun Oh and Woo-sub Kim at ohyeah@hankyung.com

Danbee Lee edited this article.

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