The big story of upstart Moderna Therapeutics

Two days ago, Moderna Therapeutics, a biotech startup in Cambridge, Mass., announced that it had raised $450 million in new funding, which is the largest financing ever for a private biotech company. The company has secured more than $950 million since its founding in 2011 by Flagship Venture.

Many biotech companies have raised large amounts of money, but nothing can quite match Moderna. Even Juno Therapeutics, the primary player in the field of CAR-T cell immunotherapy, raised only $176 million in its Series A round last year.

A Boston Magazine article[1] tells the early story about Moderna. The story began in 2006, when Shinya Yamanaka’s lab generated induced pluripotent stem cells (iPSCs) from adult cells by retrovirus-mediated transfection of four transcription factors (Oct3/4, Sox2, c-Myc, and Klf4)[2]. Yamanaka was awarded the Nobel Prize for Physiology or Medicine for the discovery iPSCs.

However, Yamanaka’s process may cause unintended mutations[3], posing big challenges on a practical application in patients. Derrick Rossi at Harvard University decided to overcome this hurdle. They used synthetic mRNA instead of DNA to induce stem cells[4]. Since RNA does not integrate into the genome, so it wouldn’t bring a cancer risk. Time magazine cited Rossi’s discovery of RNA-induced pluripotent stem cells (RiPSCs) as one of the top 10 medical breakthroughs of 2010.

Rossi‘s colleague, Tim Springer, is a scientist with business wise. Previously, Springer founded LeukoSite which successfully developed alemtuzumab and bortezomib. LeukoSite was acquired by Millennium Pharmaceuticals for $635 million in December 1999.

Springer arranged for Rossi an appointment with Robert Langer who is one of history’s most prolific inventors in medicine. It is said that if you are going to start a biotech company in Boston, you go to Bob Langer. Langer is the most cited engineer in history with 1,280 articles and 1,050 patents. Undoubtedly, Langer is a dream for many young scientists.

Langer is a very busy man with three pages of meeting schedule per day. It is said that Langer may answer seven emails on a single trip to and from the bathroom. Springer and Rossi were lucky because Langer gave them two hours.

Rossi was not the first to try to insert mRNA into a cell to express proteins. But it doesn’t matter, because exogenous RNA could activate innate immune system[5], producing significant cellular toxicity. Rossi’s breakthrough was a modified RNA to overcome innate antiviral responses. This is a much bigger discovery with commercial value than RiPSCs itself.

Three days later, Rossi make another presentation at Flagship Ventures. With the backing of Flagship Venture, Moderna was founded and more experts wanted in.

For example, Moderna’s CEO, Stephane Bancel, was previously CEO of bioMérieux, a world leader in the diagnostics industry with €2.5 billion market capitalization and more than 6,000 employees. Moderna Scientific Advisory Board Chairman, Jack Szostak, was the winner of the 2009 Nobel Prize for Physiology or Medicine.

Moderna is creating injectable mRNA molecules to produce proteins missing in patients with a certain genetic defect. The great advantage of mRNA therapy is avoiding the cancer risks traditionally associated with gene therapy. What’s more, it is not a one-time therapy like gene therapy, which means patients would have to keep buying Moderna’s procucts.

Here is a Nature Biotech paper[6] written by Moderna’s academic co-founders. Direct intramyocardial injection of a mixture of synthetic modified RNA (modRNA) and transfection agent (RNAiMAX, Invitrogen) successfully repaired and regenerated damaged heart tissue in mice.

Here is an illustrated comparison of RNA therapy and gene therapy[7]. RNA-treated mice showed improved survival with decreased side effects, such as leaky blood vessels and edema.

Moderna has partnerships with AstraZeneca (NYSE: AZN), Alexion Pharmaceuticals (NASDAQ: ALXN), and Defense Advanced Research Projects Agency. Those deals gave Moderna $365 million in cash, and plenty more to accrue in milestones. The company has $800 million in cash after this new financing. What a crazy upstart.

Moderna has no plans to file for an initial public offering anytime soon, but the 145-employee company plans immediate expansion including the addition of more than 100 employees. The company currently has 45 preclinical programs: 29 of AstraZeneca, 7 of Alexion, and 9 of its own.

Moderna is adding an entirely new drug category to the pharmaceutical industry. If successful, RNA therapy will be used to treat dozens of hard-to-treat diseases. While completely unproven in humans, it is really a promising idea.


[2] Cell. 2006, 126(4), 663-676.

[3] Nature. 2011, 471(7336), 63-67.

[4] Cell Stem Cell. 2010, 7(5), 618-630.

[5] Science. 2004, 303(5663), 1529-1531.

[6] Nat Biotechnol. 2013, 31(10), 898-907.

[7] Nat Biotechnol. 2013, 31(10), 891-892.


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