Leap Therapeutics Buys Pennsylvania-based Flame Biosciences for Access to Anti-Claudin18.2 Antibody

Leap Therapeutics, headquartered in Cambridge, Mass., acquired New Hope, PA-based Flame Biosciences. The primary focus of the merger was for Leap to pick up Flame’s FL-301, a clinical-stage anti-Claudin18.2 monoclonal antibody.

Douglas E. Onsi, president and CEO of Leap, said in a conference call, “Our strategy for our lead product and any acquired compounds is to identify specific biomarkers that will predict which patients are more likely to respond and have better outcomes. We intend to become a biomarker-focused oncology drug development company.”

In addition to FL-301, Leap acquired Flame’s FL-302, a preclinical anti-Claudin18.2/CD137 bispecific monoclonal antibody, and FL-501, a preclinical anti-GDF15 monoclonal antibody.

Leap also acquired Flame’s net cash, which Onsi said “was approximately $50 million as of year-end.” Together the combined company will have about $115 million in cash, sufficient to fund the expanded pipeline into 2025.

It was an all-stock deal. Leap issued shares of its common stock to Flame shareholders and agreed to pay the shareholders 80% of after-tax proceeds from any licensing deals of Flame’s early-stage compounds, FL-101 or FL-103.

Leap’s own lead program is DKN-01, a humanized monoclonal antibody targeting DKK1, which modulates the Wnt/Beta-catenin and PI3kinase/AKT signaling pathways. The drug has been granted Orphan Drug Designation by the FDA for gastric and gastroesophageal junction cancer as well as Fast Track Designation in combination with BeiGene’s anti-PD-1 checkpoint inhibitor tislelizumab for gastric and gastroesophageal junction adenocarcinoma tumors that highly express DKK1.

Leap and BeiGene inked an exclusive option and license deal for DKN-01 in Asia (except Japan), Australia, and New Zealand. Leap holds exclusive rights for development, manufacturing, and commercialization of the compound for the rest of the world.

DKN-01 is also being developed with Merck’s Keytruda and Genentech’s Tecentriq for gastroesophageal adenoma and advanced esophagogastric adenocarcinoma, respectively.

Flame Biosciences originally focused on a monoclonal antibody IL-1ß inhibitor. However, in the fall of 2022, abandoned the project after Novartis’ drug in the same class flunked several clinical studies. The company is a private, venture-backed cancer company with support from Samsara BioCapital, Rock Springs Capital, Janus Henderson, Adage Capital Management, Surveyor Capital, Cormorant Asset Management and others.

Under the transaction, Flame shareholders will hold approximately 58% of outstanding shares. Leap itself went public in 2016 in a reverse merger with Macrocure. Macrocure became a wholly owned subsidiary and Leap went public.

The Leap team will handle all executive positions of the combined company. Leap picked up two more board members nominated by Flame, Patricia Martin and Christian Richard. Martin is the co-CEO of Flame. Richard is Head of Public Research at Samsara BioCapital.

In a press statement, Martin said, “Flame conducted an extensive strategic process. It was clear that the Leap development team, with its expertise in developing DKN-01, was the ideal partner for FL-301, our preclinical assets, and the Flame shareholders.”

In the conference call, Onsi said, “We believe we have found the perfect fit with Flame, identifying a second clinic-ready antibody program, expanding our GI focus, building on our biomarker expertise and development strategy of building personalized medicines to a targeted patient population.”

Other companies are also focused on Claudin18.2, including Turning Point Therapeutics, Elevation Oncology and AstraZeneca. The marker is expressed in GI and pancreatic cancers.

In April 2022, AstraZeneca licensed HBM7022, a bispecific antibody targeting Claudin18.2 from Harbour BioMed for $25 million upfront and a potential $325 million in regulatory and commercial milestones.

Last May, Turning Point licensed LM-302, a Claudin18.2-targeted antibody-drug conjugate from LaNova Medicines, paying $25 million.

In July 2022, Elevation Oncology licensed Eo-3021, a Claudin18.2-targeted antibody-drug conjugate from CSPC Megalist Biopharmaceutical Co. for $27 million upfront and up to $148 million in potential development and regulatory milestones, and up to $1.0 billion in possible commercial milestones and royalties on net sales.

“We are excited to start the year as a new, stronger Leap Therapeutics with a pipeline of biomarker-targeted antibody therapeutics for cancer patients, particularly gastrointestinal cancer patients, and an enhanced balance sheet,” said Onsi.