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Did VC Third Rock Conspire with BlueBird Bio to Hurt Errant Gene Therapeutics?

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Medical Company Sues

Chicago-based Errant Gene Therapeutics has sued Third Rock Ventures and Bluebird Bio CEO Nick Leschly, alleging that the pair conspired to ‘kill’ a competing medical treatment.

Filed in Suffolk County Superior County in Massachusetts, plaintiff Errant claims that Errant Gen purchased exclusive rights to a gene therapy drug being developed by Memorial Sloan Kettering Cancer (MSKC) Center researcher Michael Sadelain, MD, PhD, in 2005.  Both the biotech ventures are developing a rare blood disease treatment. Bluebird recently secured European approval for its drug, reports Becker’s Hospital Review. Third Rock (defendant) sought to license the vector, which was a key component of the drug being developed by Dr. Sadelain.  Dr. Sadelain refused to abide by the 2010 terms.

Errant Gene signed the vector rights back to MSKC in 2011, but the plaintiff claims that Third Rock’s relationship with MSKC’s CEO Craig Thompson went to benefit Bluebird as Third Rock thereafter negotiated the rights for Bluebird.

The lawsuit essentially alleges that investor Third Rock is a proactive agent in not only going through actions to benefit its portfolio company Bluebird, but that the group conspired to damage Errant Gene Therapeutics.

It should also be noted that Errant Gene also sued MSKC for stalling their clinical trial.

If these allegations are true, Third Rock truly gets an A+ for services to its portfolio clients.  The problem becomes when the zest and dedication for portfolio company success translates to tortious behavior (if true).  Then all lose. This comes down to business interference if the allegations are true. It is a cut-throat, winner-take-all, competitive world out there. Sharp dealing is mostly okay in a business context.  When the behavior slips the parties into civil wrongs (torts) then lawyers get involved and the courts ultimately make the call.

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