Dendritic cell immunotherapy specialist Argos Therapeutics closed a $42.5-million series E round late in August by casting an unusually wide geographical net. Argos attracted venture capitalists from Russia and South Korea to invest alongside existing backers from Europe and the US, an international round that “reflects the globalization of immunotherapy,” says Jeff Abbey, CEO of the Durham, North Carolina–based company. It was not a case of Argos going prospecting but rather that indigenous pharma companies in emerging markets were looking to globalize. Drugmakers Pharmstandard of Moscow and Green Cross of Yonging-Si backed Argos' phase 3 study of personalized kidney cancer vaccine AGS-003 and secured licenses to commercialize AGS-003 in their home markets. The deal highlights an important new dynamic in funding and partnering in emerging markets, particularly relevant to early-stage biotechs with risky technologies. In countries like Brazil, Russia, India and China, it no longer makes sense to license worldwide rights to a single pharma partner, because they lack the local knowledge and networks of national champions. Even the biggest pharma partner may not have the regulatory expertise to get novel products—like dendritic cell therapies—approved in as timely a way as the local incumbent does.

For biotechs, doing deals in developing markets can bring in cash, validate risky technology and provide a source of expertise. Pharmstandard and its associated biotech operation IBC Generium are also becoming co-development partners with Argos. And this year, Pharmstandard has invested in Protagonist Therapeutics of Menlo Park, California, a specialist in orally available peptides, and Aquinox Pharmaceuticals of Vancouver, British Columbia, Canada, a specialist in the phosphoinositide 3-kinase (PI3K) pathway. All three investments were managed by Inbio Ventures, a Luxembourg-based company headed by Alexandr Shuster, a board member of Pharmstandard.

The Argos deal stands out as the first time Pharmstandard has led a round. Commenting on the investment Shuster says, “Immunotherapy is increasingly recognized as a treatment that will represent a new paradigm in the management of cancer.” Given this, investing in Argos is both a step forward in the globalization of Pharmstandard and in its focus on identifying cell-based therapies, Shuster says.