One of the most promising UK biotech start-ups, Quell Therapeutics, has signed a research collaboration and licensing deal with AstraZeneca to develop treatments for two autoimmune diseases.

The pharma giant will pay Quell $85mn upfront and up to $2bn more if it meets various development and commercialisation milestones over the next few years.

The technology developed by Quell allows the manipulation of a patient’s immune response by genetically engineering “regulatory T-cells” or Tregs. This reduces an overactive immune response in specific areas implicated in a disease.

The company’s Treg technology is an extension of the Car-T therapies that have been remarkably successful in treating cancer.

The two diseases targeted by the AstraZeneca agreement are type-1 diabetes and inflammatory bowel disease. In addition Quell plans to start a clinical trial this year of a cell therapy designed to prevent rejection of liver transplants.

Before the AstraZeneca deal, London-based Quell had raised about $220mn from a group of investors led by Syncona, a company focusing on cell and gene therapy start-ups, which now owns 33.7 per cent of Quell. Syncona’s valuation of its stake implies a total value for Quell of around $300mn.

The start-up was founded in 2019 by six immunologists from King’s College London, University College London and Hannover Medical School.

“Collaboration with AstraZeneca, our first major partner, will accelerate the application of our Treg platform in autoimmune diseases, where we believe there is a broad opportunity to reset immune tolerance and drive durable responses for patients,” said Iain McGill, chief executive.

Mene Pangalos, head of biopharmaceuticals R&D at AstraZeneca, said: “We are moving in a big way into cell therapies outside oncology, where they have been remarkably effective for treating some cancers.”

Quell’s process involves removing a patient’s Tregs — white blood cells that have evolved to prevent excessive immune responses — and making genetic changes so that they act only on specific tissues without suppressing the whole immune system. They are then infused back into the bloodstream.

In the case of type-1 diabetes, which typically begins early in life, the Tregs will be designed to stop the immune attack on insulin-producing beta cells in the pancreas, which causes the disease.

“We’ll need to do it before patients have lost all their insulin-producing cells,” said McGill. “If we can prevent further attack and keep enough beta cells active, they should remain non-diabetic. We think we can do it — and the effect would be transformational.”

This “autologous” process, in which the patient’s own cells are engineered in the lab, is also used in Car-T cancer therapies. Although it is a complex and expensive procedure, McGill believes it can be simplified and costs reduced when applied to autoimmune disease.

Quell may eventually move to a substantially cheaper “allogeneic” process that would permit the use of off-the-shelf cells from other donors but this is not an immediate prospect, said Martin Murphy, chair of Syncona and Quell.

“The mood in the markets has switched away from allogeneic recently because autologous therapies are proving so effective,” he said. “If someone came up with an allogeneic therapy which is as good as autologous, then it would displace it. But no one has been able to do that.”

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