RiverVest Funds I, II & III RiverVest Fund IV Archer Seed Fund

/ CASE STUDY

Good Therapeutics, Inc.

From Good to Great: Unlocking a biopharma platform’s full potential

box for logos good

/ BIOPHARMA COMPANY / ACQUIRED BY ROCHE (SIX: RO, ROG; OTCQX: RHHBY) IN 2022

October 6, 2023

Good Therapeutics, founded in 2016 by molecular biologist John Mulligan, Ph.D., was acquired by Roche in 2022 for $250 million upfront plus potential milestone payments. Even better, Mulligan and company retained their platform and the ability to mine it for innovative drugs to fight cancer and other diseases. The potential for conditionally active protein technology is vast and could be game-changing for patients. Here’s a peek at how Good’s acquisition played out and what the future may hold for its spinout, Bonum Therapeutics.

INVESTMENT SNAPSHOT

  • $600,000 in Seed funding
  • $22 million in Series A financing, co-led by RiverVest, and $10 million Series B round
  • $250 million (8x upfront) acquisition by Roche plus potential milestone payments
  • $93 million Series A financing for spinout company, Bonum, with original syndicate plus one new investor participating
  • Investment Syndicate: Codon Capital, Digitalis Venture, RiverVest Venture Partners, Roche Venture Fund, and 3x5 Partners

POTENTIAL IMPACT

The asset that Roche acquired is a PD1-regulated IL-2 program that complements the pharmaceutical giant’s existing oncology pipeline and expertise. As a leader in immuno-oncology and a pioneer in the field of engineered PD-1-targeted IL-2 therapeutics, Roche is uniquely positioned to expedite the development of this important program.

 

After the acquisition, Good’s entire team moved to a spinout company, Bonum (Latin for “good”), where they continue full-steam ahead to utilize the platform to discover innovative drugs. The team is focusing its efforts on regulated cytokines to treat cancer, with half a dozen programs in development. They also see potential applications in autoimmune, metabolic, and other conditions.

 

Mulligan believes that with Good’s platform, “the sky’s the limit” for making drugs that act only when and where they are needed, which could be a huge win for patients.

RiverVest Managing Director John McKearn, Ph.D.

RIVERVEST’S ROLE

When Mulligan was scouting for funding, he sought investors who could bring more than just dollars to the table; he wanted board members who could balance risk and uncertainty while supporting cutting-edge therapies for life-threatening diseases.

 

RiverVest Managing Director and Good board member John McKearn, Ph.D., recognized the enormous potential for context-dependent therapeutics in fighting cancer and other diseases and quickly jumped to action to enable Mulligan’s vision.

 

RiverVest co-led Good’s Series A financing in 2018 and later assisted in executing an acquisition that was uniquely advantageous in scope (see “Innovative Deal Structure” below).

 

“Not only does John McKearn understand our conditionally active protein technology; he understands its vast potential for treating cancer, autoimmune, metabolic, and other conditions.”

JOHN MULLIGAN, Ph.D., CEO AND FOUNDER, GOOD (NOW BONUM) THERAPEUTICS

THE UNMET NEED

Safer, more effective cancer treatments

Cancer immunotherapies, including targeted antibodies, adoptive cell therapy, oncolytic virus therapy, cancer vaccines, cytokine therapy, and checkpoint inhibitors, work by training or re-setting the immune system to detect, attack, and eliminate cancerous cells.
As scientists learn more about the immune system and its complex mechanisms, they continue to discover pathways that could make effective immunotherapies.

The problem is they are often too powerful, too widespread, and too toxic for general use. Once they enter the body, these regulators trigger overactive responses and severe side effects.

Scientists seek to direct these pathways and selectively direct anti-tumor activity precisely where it is needed.

GOOD’S SOLUTION

Potent biological activity only where needed

Good (now Bonum) is creating a new class of regulated protein therapeutics designed to deliver potent biological activity only where needed. Its two-in-one, shape-shifting molecules combine a sensor domain and a therapeutic domain to create a drug that can activate the immune system to attack the tumor.

These molecules are designed to keep the drug quiet until the sensor binds to its target. Once bound, the sensor activates the otherwise dormant drug, which then acts on tumor-specific immune cells without triggering a broader toxic response. Sensor domains can be engineered to detect a wide range of targets and physiological conditions.

The company is currently focused on developing regulated, context-dependent therapies to treat cancer. Its technology, however, has potential in other areas, such as autoimmune disease and metabolic disorders.
Animated image by Bonum Therapeutics

INNOVATIVE DEAL STRUCTURE

Mulligan and team engineered an innovative deal structure that unlocked the full potential of Good’s platform for all stakeholders:

  • Roche took full control of further research, development, and commercialization of the PD-1 IL-2 asset without the distractions that typically accompany an acquisition (employees, leases, contracts).
  • Good’s investors and employees realized early, tax-advantaged returns.
  • Bonum launched with the infrastructure usually associated with Series B-stage companies (e.g., management team, fully functional technical team, equipment, lease, validated platform, and momentum).
  • Mulligan and team are free to further the platform's potential, pursuing new, high-value molecules as a spinout company.
In other words, Good sold a golden egg but kept its proverbial goose.

BROAD PATENT PROTECTION

Unlocks potential for replicating success 

Early on, while Good was developing the infrastructure – the methods, the tools, the science of the platform – and working on its lead program (acquired by Roche) and other programs (now at Bonum), the team was also securing broad IP protection for the underlying components and methods.
With that foundation in place, Bonum is free to spin off other programs, partner in areas outside of cytokine therapy, and bring its own programs into the clinic.

(listening time: 1:00 min)

“With the foundation we’ve created, there aren’t very many sensor therapeutic pairs that we wouldn’t be able to address. This platform is beautifully simple and very effective.”

DIANE HOLLENBAUGH, Ph.D., CHIEF SCIENTIFIC OFFICER, GOOD (NOW BONUM) THERAPEUTICS

Good’s Next Chapter: Onward as Bonum!

Two months after Good’s acquisition, Bonum Therapeutics announced a $93M Series A Financing  to advance Good’s conditionally active therapies program. The original syndicate, plus one new investor, participated in Bonum’s financing.


Bonum (Latin for “good”) launched with Good’s proven technology, experienced team, supportive board, and several exciting projects already in progress.


The team is initially focused on regulated cancer therapies but will explore other potential applications including autoimmune and metabolic diseases.

Follow Bonum’s progress at www.BonumTx.com and connect with them on LinkedIn and Twitter.

John Mulligan, Ph.D.

Founder and Chief Executive Officer
Good (now Bonum) Therapeutics

About Good’s Founder

 

John Mulligan, Ph.D., is a scientist and executive with 30 years of experience in research management, drug discovery, technology innovation and company formation. He was the Founder and CEO of Good Therapeutics until it was acquired by Roche in 2022. 

 

Prior to Good, Mulligan founded Glycostasis, where he invented a glucose-responsive insulin technology and sold the company to Eli Lilly. As the Director of Genomics at Darwin Molecular, he pioneered a genetic approach to target discovery that yielded an osteoporosis drug target. Romosozumab, an antibody to this target, was recently approved in the US, Europe, and Japan for the treatment of osteoporosis.

 

After leaving Darwin Molecular, Mulligan founded Blue Heron Biotechnology, an early synthetic biology company that was acquired by Origene, and co-founded the International Gene Synthesis Consortium, an industry group focused on biosecurity and the appropriate regulation of synthetic biology. 

 

Mulligan received a BS in Biology from MIT, then spent 12 years at Stanford as a Ph.D student with Sharon Long in the Department of Biology, a postdoctoral fellow with Ronald W. Davis in the Department of Biochemistry, and a Research Assistant Professor in the Department of Genetics where he helped set up the Stanford Genome Technology Center.