Boston's Acetylon Gets Taken Out By Celgene, Will Spin Out Startup Regenacy Pharma

December 5, 2016
By Mark Terry, BioSpace.com Breaking News Staff

Summit, NJ-based Celgene announced Friday that it will be acquiring Boston-based Acetylon Pharmaceuticals. In a complicated switch, before the deal is closed, Acetylon plans to spin off some of its pipeline into a new company, Regenacy Pharmaceuticals.

In addition to the overall company, Celgene will acquire worldwide rights to Acetylon’s selective HDAC6 inhibitor programs, as well intellectual property related to oncology, neurodegeneration, and autoimmune disease. That acquisition also includes Acetylon’s citarinostat (ACY-241) and ricolinostat (ACY-1215).

Regenacy will take with it exclusive worldwide rights to Acetylon’s Phase II HDAC6 inhibitor ricolinostat (ACY-1215) to treat certain non-cancer disease indications that include neuropathies. In addition, it will have Acetylon’s preclinical selective HDAC1,2 inhibitor candidates and a group of patents to develop in all human disease indications, including sickle cell disease and beta-thalassemia.

Regenacy will be located in Acetylon’s former headquarters in Boston’s Seaport District. A group of Acetylon’s executive team will join Regenacy. The new company will be owned by Acetylon shareholders, excluding Celgene.

Financial details have not been disclosed.

“Since its founding in 2008, Acetylon has made substantial progress in the development of selective HDAC inhibitors for enhanced therapeutic outcomes,” said Walter Ogier, president and chief executive officer of Regenacy, in a statement. “We are excited to continue Acetylon’s legacy through the receipt of rights to many of Acetylon’s most promising compounds and the continued advancement of these clinical and preclinical programs in disease indications outside of Celgene’s areas of strategic focus, where we believe patients may especially benefit from selective HDAC inhibition.”

Celgene and Acetylon have a prior relationship. In 2013, the two companies inked a deal where Celgene paid Acetylon $100 million as an option to buy Acetylon outright for another $500 million. It also included what was dubbed “bio-bucks,” $1.1 billion in future payments related to clinical milestones.

In 2015, that partnership got extended, but included a contingency clause saying that the relationship would be terminated in May 2016 if Celgene didn’t acquire Acetylon. And in July, Celgene exercised that termination clause.

The company stated at the time, “In May 2016, our collaboration and option agreement with Acetylon expired. As a result, we do not have an exclusive right to acquire Acetylon or any right to receive any research and development services from Acetylon or have any obligation to pay any milestone payment under that agreement. We have retained our equity interest in Acetylon.”

Acetylon has about 40 employees, and was founded in 2008. Selective histone deacetylase (HDAC) inhibitors are small molecules that are involved in fundamental gene expression. Engineered, targeted versions of the enzymes are designed to interfere with gene and protein expression.

Ogier told Xconomy that Celgene had only been interested in some of Acetylon’s current portfolio. However, Acetylon and its shareholders wanted to go ahead with the rest of it pipeline. As a result, they agreed to let the original partnership deal terminate and developed this new strategy with a spinoff company. “The remaining assets are exciting enough to create a new company to advance,” Ogier said.

“Acetylon has had a longstanding partnership with Celgene, and their acquisition of our HDAC6 inhibitor program is a positive event for patients and a favorable outcome for our shareholders and employees,” said Marc Cohen, Acetylon’s chairman, in a statement. “Celgene is the optimal partner to realize the fullest potential of Acetylon’s selective HDAC6 inhibitor programs in multiple myeloma and other oncology indications. Their intimate knowledge of citarinostat and extensive experience in oncology make them uniquely qualified to continue development of these exciting programs.”