Bayer acquires small molecule startup Vividion Therapeutics for up to $2 billion

Bayer is beefing up its investment in new approaches for small molecule drug discovery with the acquisition of Vividion Therapeutics, an early-stage startup founded by Scripps Research chemists Benjamin F. Cravatt, Phil S. Baran, and Jin-Quan Yu. Bayer will pay $1.5 billion upfront and up to $500 million in milestone payments for the San Diego-based startup, which does not yet have any drug candidates ready for clinical testing.

The investment is a bet on Vividion’s unique approach to tackling proteins that are linked to disease but historically hard to drug. Such proteins, which include transcription factors involved in cancer and inflammatory diseases, lack obvious footholds for small molecules to latch onto and are often labeled as undruggable.

Since forming in 2014, Vividion has raised about $500 million, a figure that includes sizable investments from Roche and Celgene, which was later acquired by Bristol Myers Squibb (BMS).

The startup is based on a fragment-based screening platform developed by chemical biologist Cravatt coupled with a library of covalent fragments created by synthetic chemists Baran and Yu. Vividion covalently tags the reactive cysteine residues on thousands of proteins inside living or lysed cells to identify previously unknown or overlooked footholds for small molecules. Vividion says it has discovered more than 800 novel binding pockets in more than 250 proteins.

Once those footholds are established, they can be used for a variety of purposes. Vividion’s most advanced programs focus on developing allosteric activators and inhibitors, which work by binding to a protein’s newly-identified foothold in order to alter the structure and function of another site of the protein. The footholds can also be used to develop molecules that affect protein-protein interactions, or find new targets for the red-hot field of targeted protein degradation.

Bayer gets access to Vividion’s most advanced drug discovery programs, which are focused on inhibitors and activators of NRF2, a transcription factor that controls the expression of many genes, especially ones involved in responding to oxidative stress that can damage cells. NRF2 inhibitors could be used to treat some cancers, and NRF2 activators may be help in treating chronic inflammatory diseases. The startup is also developing inhibitors of the transcription factor STAT3 as part of its collaboration with BMS, and inhibitors of Werner syndrome helicase through its pact with Roche.

Vividion’s partnership with Roche also involves developing protein degraders, bifunctional small molecules that bind to a target protein at one end and link up to another protein called an E3 ligase at the other end. The E3 ligase helps tag the target protein for destruction in the cellular equivalent of a trash compactor. Although human cells contain hundreds of E3 ligases, only a few have been well studied. Vividion has used its chemoproteomics techniques to find compounds that can bind to new E3 ligases.

Vividion’s approach is part of a larger suite of strategies collectively known as chemoproteomics, which other drug discovery groups are pursuing as well. Novartis and the University of California, Berkeley, established a virtual research center centered on chemoproteomics in 2017. And Frontier Medicines, a startup based on chemoproteomics work at Berkeley, recently raised $88.5 million in series B financing to develop protein degraders.

Bayer says that Vividion will “operate autonomously and on an arm’s length basis,” which is a similar approach to those the big firm took during its acquisition of the gene therapy company AskBio last year and its acquisition of the stem cell therapy company BlueRock Therapeutics in 2019.