Bristol-Myers Squibb (BMY 0.28%) and drug development accelerator BioMotiv have launched Anteros Pharmaceuticals, a biotech company focused on developing drugs for fibrotic and other inflammatory diseases. The new company is based on discoveries on an undisclosed target made at Yale University, which were licensed by Bristol-Myers and then assigned to Anteros. The initial work already includes a series of small-molecule drug candidates against the target.

BioMotiv and Bristol-Myers have been working together for five months through a partnership to establish multiple new companies. Anteros is the first start-up to emerge from the relationship.

BioMotiv will be responsible for research and development at Anteros. Once the company has a preclinical candidate, Bristol-Myers will have the option to purchase Anteros at a pre-specified price.

Scientist working in a lab

Image source: Getty Images.

Large drug companies have been doing this type of build-to-buy model for a while. Biogen, Celgene -- now part of Bristol-Myers -- and GlaxoSmithKline have all established partnerships with venture capital funds to create start-ups that the drugmakers have the option to eventually acquire. Johnson & Johnson and Bayer have taken a different approach, establishing their own no-strings-attached incubators to help start-ups grow while keeping a watchful eye on new technologies.

The model likely costs the companies more to develop individual drugs, but it reduces the risk of failure and keeps their research divisions at a manageable size. The model could also result in drugs being developed faster. A singularly focused small biotech may be more motivated to develop a candidate treatment more quickly than a larger pharmaceutical company with multiple interests.