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January 7, 2021

Biohaven acquires fellow Elm City biotech

PHOTO | CONTRIBUTED 150 Munson St., New Haven
By Natalie Missakian

Growing New Haven bioscience firm Biohaven Pharmaceuticals just got bigger. 

The migraine drug maker announced Thursday morning that it has acquired fellow Elm City biotech Kleo Pharmaceuticals and its 10,000-square-foot lab at 150 Munson St., where it has launched a new chemistry and discovery research arm called Biohaven Labs at Science Park.

Biohaven, which already held a 42% stake in the five-year-old immuno-oncology startup, said it acquired the remaining shares of the company on Jan. 1 in a stock deal valued at $20 million.

Under the deal, Kleo stockholders will receive around .oo7 of a common share of the company, and a "contingent value right" that will pay $1 in cash if certain Kleo drugs win Food and Drug Administration approval.

Boards of directors for the two companies approved the merger based on the unanimous recommendation of a special committee of independent directors of Kleo, according to Biohaven.

Simultaneously, Biohaven said it has executed an exclusive license agreement with Yale University for a new “extracellular degrader” technology developed by Kleo founder and Yale chemistry professor Dr. David Spiegel. 

The deal also gives Biohaven, which is headquartered at 215 Church St., full ownership of Kleo’s two immune modulating technologies, its multi-targeted Antibody Therapy Enhancer (MATE) conjugation platform and its Antibody Recruiting Molecule (ARM) platform.

Biohaven said it will absorb Kleo’s chemistry and discovery staff who will continue to work on an ongoing Kleo program to develop a COVID-19 drug using the MATE technology. That program is being bolstered by a $5 million grant from the Bill & Melinda Gates Foundation.

Biohaven Labs will also continue working on Kleo’s cancer therapies, which it was developing with Japanese biopharma PeptiDream. 

Kleo was preparing to begin human testing on a drug to treat the blood cancer multiple myeloma.

In a statement, Yale’s Spiegel called Biohaven CEO Dr. Vlad Coric and his team “a visionary group with the ability to bring all of these technologies into the clinic.”

Coric said in a statement that Biohaven will “harness the full potential of these novel technology platforms to create value for patients and investors.” 

In an email Thursday morning, he said Kleo CEO Doug Manion and CFO Roy Prieb will continue to be available to Biohaven as consultants. 

“Doug will play an important role as an external consultant to the infectious disease assets, including the COVID-19 HGM project with the Gates Foundation,” he told New Haven Biz.

Biohaven, which develops drugs for neurological conditions, launched its first commercial product last March after winning FDA approval for its migraine pill Nurtec ODT. 

Contact Natalie Missakian at news@newhavenbiz.com

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