On Thursday, it was announced that BlueRock Therapeutics, a stem cell-focused biotech company with operations in Toronto, is set to be fully acquired by German multinational pharmaceutical and life sciences company Bayer AG.
“Our Toronto location has been integral to driving our entrepreneurial and innovative culture.”
– CEO BlueRock
As first reported by The Globe and Mail, Bayer already owned 40.8 percent of BlueRock and will be paying almost $600 million (all numbers USD) to acquire the remaining 59.2 percent that is held by VC firm Versant Ventures and BlueRock’s management team. According to Bayer, its investment brings BlueRock’s total company value to approximately $1 billion. The transaction is set to officially close during the third quarter of 2019.
BlueRock is a cell therapy company with a mission to develop regenerative medicines for intractable diseases. It was launched through a $225 million collaboration between Bayer and Versant in December 2016. While the startup is headquartered in Cambridge, Mass., it operates in three cities including Toronto and New York. Toronto has been a major part of the company’s operations, and according to Emile Nuwaysir, president and CEO of BlueRock, it has no plans of leaving the city following the acquisition.
“Our Toronto location has been integral to driving our entrepreneurial and innovative culture,” Nuwaysir told BetaKit. “Our R&D facilities in Toronto allow us to benefit from its close proximity to [our] partner, University Health Network (UHN), and scientists Gordon Keller and Michael Laflamme.”
BlueRock first developed its partnership with Toronto’s UHN through the McEwen Stem Cell Institute before it officially launched in 2016. According to Versant, the VC firm first conceived and began to build BlueRock in late 2015 and 12 months were spent securing its foundational technology, which came from the stem cell institute at UHN as well as the Stem Cell Center at Memorial Sloan Kettering in New York. Keller, who has been called a world leader in stem cell biology, is a scientific co-founder of BlueRock, as well as the director of Toronto’s McEwen Institute. Laflamme, a pioneer in cardiac cell therapy, is a founding investigator of BlueRock, as well as a senior scientist at Toronto General Hospital Research Institute.
Blue Rock’s Toronto office is located in the MaRS Discovery District. The startup currently operates a pilot cGMP manufacturing facility (a production facility for the manufacturing of pharmaceutical or cellular products) in Toronto, which will remain part of the company.
“BlueRock’s vision remains unchanged; the company will continue to pursue breakthrough cell therapy innovation in the fields of cardiovascular, neurology and immunology in our three locations: Toronto, Cambridge, Mass., and New York City,” he stated.
The $225 million that BlueRock received from Bayer and Versant was, at the time, the second largest-ever Series A financing for a biotech company in Canada, according to BIOTECanada, an industry association for professionals in health, industrial, and agricultural biotechnology sectors. BlueRock used the capital to expanded its R&D team to more than 100 scientists, and refine development and manufacturing capabilities to efficiently engineer and produce cell therapies at commercial scale. Part of BlueRock’s research and development includes a “promising treatment” for Parkinson’s disease, which according to Versant is expected to enter the clinic by the end of the year.
BlueRock noted that it plans to continue increasing its headcount through to the end of 2020 as its clinical programs develop.
Image Courtesy BlueRock Therapeutics via Twitter