Otsuka bids for a seat at the conjugate table

Otsuka's Taiho subsidiary must have seen something it liked in Araris's ADC technology after licensing rights to it in November 2023. That discovery deal on Monday turned into a full takeover of Araris, with the Japanese group paying the private company's backers $400m up front and pledging a further $740m dependent on future milestones.

The takeover gives Taiho full control of the technology, whose key feature is a linker designed to remain stable until internalised, but it also brings a pipeline of preclinical-stage ADCs, two of which use a dual payload approach – an emerging theme in ADC development. Perhaps Taiho wanted to lock in its target before Roche had a chance.

Roche has been sniffing around Araris's linker technology, and in January its Chugai division signed a discovery deal similar in structure to the one Taiho struck back in 2023: Chugai was to provide targets against which Araris was to generate ADCs. Terms were undisclosed, but said to total up to $780m in up-front fee and milestones.

It's possible that Taiho, having had more time to work with Araris's tech, feared Roche launching a bid. The Chugai alliance is now expected to pass to Taiho, so if Roche does want full control it will in future have to negotiate a deal with Otsuka rather than with Araris, a private Swiss company.

For Araris's backers, which include 4Bio Capital, b2venture and Pureos Bioventures, $400m up front represents a significant windfall; since being founded in 2019 as a spin-out from the Paul-Scherrer-Institute, Araris is understood to have raised only $44m in seed and venture financing.

Preclinical portfolio

Taiho has no presence in ADCs beyond the 2023 Araris deal, according to OncologyPipeline, so the preclinical projects Araris brings should be of immediate interest.

One of these hits NaPi2b, a target known for its intractability, with Zymeworks recently joining the likes of Mersana and Roche in hitting the stop button on development-stage ADCs. Others are less original, including Nectin-4 and the hugely crowded space of HER2; Araris's plan was to begin clinical trials with some of these in 2025/6.

But a more intriguing aspect of Araris's portfolio is that at least two of the assets use dual payloads, according to a poster at last year's AACR meeting. This approach has prompted early work at companies including Adcoris, CrossBridge Bio and Callio Therapeutics, though Araris's work seems curious.

The driving theory here is that patients treated with a typical ADC can relapse by developing resistance to its payload, so developing a molecule that employs two differing payload types could counteract this. However, such thinking doesn't precisely apply to Araris, since the two payloads its ADCs use are both topoisomerase 1 inhibitors.

The AACR presentation suggested that the two payloads had "different features" that could increase efficacy and improve therapeutic index. It will now be up to Taiho to take this concept forward.

ADC projects Araris has worked on

Note: DAR=drug-to-antibody ratio. Source: OncologyPipeline.