Image credit: Mosaic Therapeutics
Mosaic Therapeutics exemplifies how our research can have a veritable impact on society. We, at the Wellcome Sanger Institute, are committed to innovative science at scale, but we need partners and investors to transfer this science into the clinic. The Genomics Innovation team helps build these partnerships to make ventures like Mosaic possible. Here, Mariya Chhatriwala, Business Development Manager at the Sanger Institute, gives us her insights on how Mosaic, Sanger’s fifth spin-out company, came to be.
Over the past three and a half years I’ve been immersed in spinning out Mosaic. Having recently come out of stealth after raising £22.5M from top-tier venture capital (VC) firms, it is the latest of several spin-outs built on the Institute’s cutting-edge science. Sanger spin-outs have the ability to carry out high-throughput genomic research at an exceptional scale that enables unique insights into biology.
Dr Mathew Garnett, a leader in the field of cancer genomics, used pipelines and infrastructure provided by the Institute to develop a world-class cancer target and drug discovery platform. To accelerate and maximize the potential of this platform, the next step was to secure funding to build a spin-out around the technology that would focus on developing the next generation of cancer therapeutics.
Mathew Garnett and Mosaic Therapeutics colleague working together in the laboratory
Mathew Garnett and Mosaic Therapeutics colleague working together in the laboratory
Validating the technology
A spin-out’s journey usually begins long before it starts looking for investment. In the case of Mosaic, Mathew has been developing the technology at its core for over 15 years. This includes industry-validated robust computational pipelines, datasets and databases that are now used worldwide by other cancer researchers, and next-generation biological tools that can mirror cancer’s heterogeneous nature. Each component on its own would be a valuable asset, but Mosaic’s unparalleled ability to integrate these elements allows it to obtain novel therapeutically valuable insights.
The research environment provided by Sanger is uniquely capable of facilitating experiments at the scale needed to create the cancer drug discovery platform now being utilised by Mosaic. There are few other institutions that would be able to carry out screens - experiments to systematically search for new ways to treat cancer - on over 1,000 different cell models and process such a vast amount of data. An example of the research platform’s power to identify novel targets associated with strong biomarkers. For instance, in cells that show a high degree of microsatellite - a short, repeated sequence of DNA - instability, Werner Helicase has been identified as a potential target. Werner Helicase is now being targeted by Ideaya Biosciences and Glaxo SmithKline as part of a strategic partnership to potentially treat several cancer types including colorectal.
Colorectal organoid cells seen through a light microscope
Mosaic Therapeutics' services are founded on genomic insights derived from studying cell models of cancer. One cellular model type is organoids - clusters of cells that form working models of human organs.
Securing Funding
In September 2019, Mathew Garnett successfully applied for a Sanger Translation Committee fund award to improve the data processing and analysis platform used by his research group. This computational framework eventually became Mosaic’s PRIME computational pipeline.
The precursor to the PRIME computational pipeline used by Mosaic is highly regarded by leaders in the field and there have been articles that have come out from companies such as Tango Therapeutics - which operates in the same scientific space - that acknowledge just how well that particular pipeline identifies new targets. Given the pharmaceutical industry's interest in collaborating with Mathew and his platform, it was obvious that there was a desire for developing this expertise.
After successfully securing the Sanger Translation Committee fund award, Dr Adrian Ibrahim, who was then Head of Technology Translation at the Wellcome Sanger Institute and is now a co-founder of Mosaic, and Mathew, decided to apply for an Innovate UK grant. This funding could only be awarded to a company-led initiative, as the aim was to support the industrialisation of genomic technologies for the benefit of patients. To meet this requirement, Mosaic Therapeutics was incorporated in 2020 and incubated as a wholly-owned subsidiary of the Wellcome Sanger Institute.
Furthermore, the Innovate UK award would allow Mathew and Adrian to develop technology to better utilise the biological tools, such as Mathew’s team’s organoid cultures, and further develop the computational platform. It also allowed them to hire staff and start developing a commercial drug discovery pipeline independent of Mathew’s academic research program.
I joined the Genomics Innovation team at the Sanger Institute as all of this was happening in April 2019. It was an exciting time and I quickly got roped into the process of spinning out Mosaic, leading on this on behalf of the Genomics Innovation team. One of my first tasks was to help Adrian and Mathew apply for the Innovate UK grant. Easier said than done! This not only included a lot of writing but also liaising with third parties such as Medicines Discovery Catapult, which provided invaluable information on the drug discovery capability in the UK. I also carried out a detailed analysis of the competitive landscape to support our grant application, as well as subsequent pitches to Venture Capital firms. Excitingly, we were successful and secured £1 million for Mosaic and the Sanger Institute. Importantly, this funding provided the company with a significant runway for securing financing and derisking the opportunity. Overall, this likely increased its value in the eyes of potential investors.
Today, Mosaic is a fully spun-out company and has secured £22.5M of funding from Syncona and Cambridge Innovation Capital - two venture capital firms with impressive track records.
Translation expertise when creating a spin-out
Spinning out a company founded on Intellectual Property (IP) developed and owned partially, or wholly, by the Institute is always an exciting undertaking. Sanger spin-outs are typically based on a varied portfolio of IP including knowledge of operating large-scale pipelines, software code, materials, and patents. This requires an exceptionally challenging diligence process: I needed a full grasp of the technology requested from Sanger by the company to enable all parties to make an informed decision around how it would be used.
Determining ownership is another variable - who owns IP? Sometimes this is a bit fuzzy, and that’s where due diligence is crucial: who helped deliver the assets, who funded their creation, who else has been involved in the process, do they have a say in the IP and are they happy for this to go into a commercial entity? Many questions, but it’s important to the Sanger Institute to identify anyone who has contributed to the IP to properly reward them.
The spinout process also weaves in many actors with different interests, both within and outside our Institute. A commercial vehicle that can attract the necessary investment is a great route to increase the chance and speed of our technologies delivering novel future drugs. Our job at the Genomics Innovation team is to enable this to happen - set the company in good stead to compete or partner with others, and secure future investment. As the Business Development Manager responsible for this project, I lead negotiations on behalf of the Sanger Institute with both investors and founders. Key areas of negotiation included company valuation, equity splits, investment structure and license structure. In addition, as the IP that will be utilised by Mosaic has been generated using Wellcome’s charitable funds, Sanger needs to ensure that Mosaic’s activities align with its mission to improve health.
Commercial strategy, which is understandably profit-driven, does not always align completely with academic and charitable goals which prioritise impact. Finding and negotiating terms that set the company for success and take into accounts our academic values is a good chunk of the role - it can take discussion and negotiationg. However, this does not mean that they are incompatible, and in this case, all parties were firmly committed to finding mutually beneficial terms.
“Throughout this process, I worked closely with many other teams at Sanger, including the Legal and Governance Team, the Finance Team, Research Managers, and the Grants Office. Their roles were critical to the successful spinning-out of Mosaic Therapeutics.”
Dr Mariya Chhatriwala,
Business Development Manager
The creation of a spin-out company such as Mosaic can bring significant benefits, like innovative treatment options for patients in need. However, it also carries significant risk. To spin-out a technology implies a big commitment, and naturally, this limits the options for the IP to be explored by others. How do we know this is the best option? In situations like this, the Sanger Institute’s Board provides guidance to ensure the best possible outcome for the Institute. To facilitate this, I acted as a link between the Innovation Team and the Sanger Institute’s Board, keeping them updated and making recommendations. I also had the opportunity to identify and recruit a non-executive director to represent Sanger on the company’s Board post-spin-out.
Mosaic is now a fully spun out company. Reflecting back, this has been a terrific and highly rewarding journey. I have the privilege to still remain involved with the company as an observer on its Board and I also act as an informal ‘alliance manager’ looking after the Sanger-Mosaic relationship moving forward.
I get asked many times - why commercialise our research? Well, cutting-edge academic research is necessary to drive science forward and that is what we do at Sanger. And then, a commercial route is often the best way to effectively employ new technology to ensure it will benefit patients. I think Mosaic is a great example, and we, in the Genomics Innovation Team, are committed to building more opportunities like it.
