Boehringer Ingelheim Acquires Nerio Therapeutics for Up to $1.3 Billion, Gaining Clinical-Stage PTPN1/2 Inhibitor Co-Developed with Chinese Incubator Viva BioInnovator

On July 29 (U.S. Pacific Time), Boehringer Ingelheim announced the acquisition of Nerio Therapeutics (“Nerio”), a company invested in and incubated by Viva Biotech, for up to $1.3 billion.

Nerio’s core pipeline features a small-molecule PTPN1/2 inhibitor, an oncology asset currently in the preclinical stage. This inhibitor activates the immune system to combat cancer cells by inhibiting protein tyrosine phosphatases N1 and N2 (“PTPN1” and “PTPN2”). The acquisition will significantly strengthen Boehringer Ingelheim’s immuno-oncology pipeline, with the aim of improving therapeutic outcomes for cancer patients.

Nerio is a drug discovery and development company focused on phosphatases. Founded by Avalon Ventures, it has received support from investors including Bregua Corporation, Correlation Ventures, Alexandria Venture Investments, and the Viva Biotech Innovation Center.

Nerio was developed through the Avalon BioVentures accelerator, leveraging its expertise in early-stage drug development and comprehensive corporate support. Avalon Ventures is a venture capital firm that has long focused on seed and early-stage companies; founded in 1983, it has established and funded more than 100 information technology and life sciences companies.

Regarding this acquisition, Sanford Madigan, Partner at Avalon BioVentures and Co-founder and CEO of Nerio Therapeutics, stated, “We believe that Nerio’s small-molecule PTPN1/N2 inhibitors possess superior drug properties and offer the opportunity to become first-in-class.”

Sanford Madigan has a strong scientific background and over 25 years of experience in corporate finance, operations, business development, and mergers and acquisitions. In addition to the aforementioned roles, he currently serves as the Chief Executive Officer of Ankasa Rogenic Therapeutics and is the Founder and Chief Executive Officer of Strategic Enzyme Applications. Furthermore, all partners at Avalon Ventures are seasoned entrepreneurs with extensive experience in company formation, operations, and value creation within the life sciences and technology sectors.

As a startup, Nerio boasts not only the strong endorsement of Avalon Ventures but also equally formidable support from other incubators and investment firms behind it. Notably, the Viva Biotech Innovation Center, a domestic incubation hub, has drawn significant attention. Officially established by Viva Biotech in 2017, it constitutes one of the company’s three core business segments.

Viva BioInnovator (hereinafter referred to as “VBI”) is the core division of Viva Biotech responsible for investment incubation and its Equity-for-Service (EFS) business. By integrating its established Cash-for-Service (CFS) model with its proprietary EFS innovative business model, Viva Biotech achieves both stable cash flow inflows and substantial returns from long-term drug incubation investments.

Leveraging Viva Biotech’s extensive experience and technological advantages accumulated over many years in the field of new drug R&D, the Viva Biotech Innovation Center provides investment and continuously optimizes a suite of platform-based post-investment value-added services tailored to the diverse needs arising from new drug development and various stages of company growth. These services encompass R&D support, facility and logistical assistance, industry matchmaking, and financing and investment facilitation.

As of now, the Viva Biotech Innovation Center has invested in and incubated more than 90 early-stage innovative biopharmaceutical companies, with over 200 product pipelines developed by its incubated portfolio companies. Among these incubated and invested enterprises are Weimou Biotechnology, Suozhi Biotechnology, and Bichen Pharmaceuticals.

Backed by well-capitalized investors with abundant resources, this is undoubtedly a key factor enabling Nerio’s rapid growth and gaining recognition from top-tier pharmaceutical companies.

Beyond its strong financial backing, Nerio’s focus on “undruggable” targets also holds significant value. In recent years, treatment modalities such as radiotherapy and chemotherapy have advanced rapidly. Although these therapies exert cytotoxic effects on tumors, their non-selective nature can also damage patients’ healthy tissues. Many patients discontinue treatment due to intolerance of side effects, leading to severe disease recurrence.

On this basis, targeted therapies represented by PD-1 and its ligand PD-L1 blockers have rapidly advanced. However, currently only about 10% of targets have been successfully developed into targeted drugs for treatment. Another approximately 10% of targets are under research and development to be developed into targeted drugs. The remaining roughly 80% of targets are considered undruggable with current inhibitor drug development technologies and cannot be developed into targeted inhibitor drugs.

For the 20% of targets that are druggable, the annual market for inhibitor-based targeted therapies already reaches $200 billion. If the remaining 80% of currently “undruggable” targets could be leveraged for drug development, the market potential would be immeasurable.

Phosphatases, due to their highly polar active sites, are widely recognized as a class of potentially high-value “undruggable” targets.

Notably, genetic deletion of the protein tyrosine phosphatase PTPN2 (also known as TC-PTP) and its paralog PTPN1 (also known as PTP-1B) in tumor cells or immune cells can promote anti-tumor immune responses. Therefore, unlike current therapeutic approaches, PTPN2/N1-targeted therapy can achieve a dual anti-cancer mechanism by directly acting on tumor cells and enhancing the anti-tumor activity of immune cells.

In response, Nerio has developed novel, potent, and highly selective PTPN2/N1 inhibitors with superior drug-like properties. As first-in-class agents, Nerio’s PTPN2/N1 inhibitors enhance immune function and increase tumor sensitivity to pro-inflammatory signals, thereby driving robust antitumor activity. These small-molecule inhibitors can be used not only as monotherapies but also in combination with a variety of internally developed oncology therapies, serving as a key complement to the company’s treatment portfolio.

Currently, Nerio’s oncology pipeline of PTPN2/N1 inhibitors is still in the preclinical stage, with an Investigational New Drug (IND) application to the U.S. Food and Drug Administration (FDA) expected later this year to initiate clinical trials.

This acquisition marks a bold step by Boehringer Ingelheim toward transforming the landscape of cancer treatment. It further strengthens its pipeline in targeted cancer cell therapies and immuno-oncology research, aiming to deliver maximum benefit to cancer patients through a strategic product portfolio. Paola Casarosa, Member of the Board of Directors at Boehringer Ingelheim, stated, “The addition of Nerio Therapeutics’ innovative immune checkpoint inhibitors creates broad and exciting new opportunities for Boehringer Ingelheim’s oncology portfolio. This brings us one step closer to realizing our vision of transforming the lives of cancer patients.”

Notably, AbbVie has also entered the same target space.In collaboration with Calico Life Sciences, a small molecule has been designed to enter cells and bind to the phosphatases PTPN2 and PTPN1, enabling effective tumor treatment through immunomodulation. This pipeline, named ABBV-CLS-484, is currently in Phase I clinical trials.

In China, Insilico Medicine has also developed a novel PTPN2/N1 inhibitor with drug-like properties and oral bioavailability in vivo through its generative AI platform, Chemistry42.It exhibits nanomolar inhibitory potency, favorable oral bioavailability in vivo, and robust antitumor efficacy in vivo. This study was published in the European Journal of Medicinal Chemistry this April, and the related research is currently in the preclinical development stage.

References:
Viva Biotech, “VIVA Circle of Friends | $1.3 Billion Deal: Nerio, a Company Incubated and Invested by Viva Biotech, Acquired by Boehringer Ingelheim”