Ronald Crys­tal's Lex­eo Ther­a­peu­tics pulls in a $100M megaround just nine months af­ter launch

About a month af­ter Lex­eo Ther­a­peu­tics ac­quired Ste­lios Ther­a­peu­tics — bring­ing its 18-pro­gram gene ther­a­py pipeline to 21 — in­vestors are reach­ing a lit­tle deep­er in­to their pock­ets to en­sure the New York City-based biotech is up to the task.

Lex­eo un­veiled a $100 mil­lion Se­ries B round on Thurs­day morn­ing, led by D1 Cap­i­tal Part­ners and Even­tide As­set Man­age­ment. The funds will be used to sup­port the com­pa­ny’s “next phase of growth,” ac­cord­ing to CEO Nolan Townsend, with a spe­cif­ic fo­cus on three lead­ing gene ther­a­pies — one for CLN2 Bat­ten dis­ease, one for Alzheimer’s, and one for a rare con­di­tion called Friedre­ich’s atax­ia.

Ronald Crys­tal

The com­pa­ny’s roots trace back to gene ther­a­py long hauler Ronald Crys­tal, who’s been work­ing in the field since the 1980s. He took his ideas to Weill Cor­nell Med­i­cine in 1993, where he helped build a large gene ther­a­py pro­gram and spent more than a decade de­vel­op­ing po­ten­tial can­di­dates.

Af­ter de­cid­ing to splin­ter off, Crys­tal as­sem­bled a sea­soned brain trust to lead Lex­eo, in­clud­ing Townsend, who spent 12 years at Pfiz­er; chair­man Steven Altschuler, who was pre­vi­ous­ly chair­man of gene ther­a­py pi­o­neer Spark Ther­a­peu­tics; and ex­ec­u­tive VP and CMO Jay Barth, who hails from  Am­i­cus Ther­a­peu­tics and PTC Ther­a­peu­tics. Crys­tal has al­so kept his po­si­tion at Weill Cor­nell.

Nolan Townsend

The pipeline cur­rent­ly in­cludes eight can­di­dates for car­diac and CNS dis­or­ders, plus an­oth­er 13 undis­closed pro­grams. How­ev­er, on­ly two have reached the clin­ic: LX1004, which re­cent­ly com­plet­ed a Phase I/II study and is head­ed for a piv­otal tri­al in 2022 for CLN2 Bat­ten dis­ease, an au­to­so­mal re­ces­sive lyso­so­mal stor­age dis­ease; and LX100, cur­rent­ly in Phase I for APOE4-as­so­ci­at­ed Alzheimer’s dis­ease.

Townsend’s al­so lin­ing up a third can­di­date for the clin­ic, dubbed LX2006, for Friedre­ich’s atax­ia. FA is a rare, de­gen­er­a­tive mul­ti-sys­tem dis­or­der caused by a gene mu­ta­tion that dis­rupts the nor­mal pro­duc­tion of the pro­tein fratax­in, crit­i­cal to the func­tion of mi­to­chon­dria in a cell. Lex­eo is plan­ning on sub­mit­ting an IND for that in­di­ca­tion lat­er this year.

Lex­eo in­tends to main­tain an on­go­ing re­search col­lab­o­ra­tion with Weill Cor­nell to bol­ster their pre­clin­i­cal pipeline — and with the Ste­lios ac­qui­si­tion back in Ju­ly, they ac­quired a new aca­d­e­m­ic part­ner in UC San Diego’s de­part­ment of car­di­ol­o­gy.

And while Lex­eo re­mains well-fund­ed (the lat­est round brings the start­up’s to­tal raise to $185 mil­lion), Townsend says he isn’t rul­ing out an IPO: “We can cre­ate a lot of val­ue and reach clear val­ue cre­ation mile­stones with­out an IPO or an ad­di­tion­al fi­nanc­ing here. So it’s not nec­es­sary, but ob­vi­ous­ly for any com­pa­ny we’re al­ways think­ing in­to the fu­ture and that is, you know, one of the con­sid­er­a­tions that we have.”

In ad­di­tion to D1 and Even­tide, a slate of new and old in­vestors chipped in­to the round, in­clud­ing CAM Cap­i­tal, Veri­tion Fund Man­age­ment, Lau­ri­on Cap­i­tal Man­age­ment, Gray’s Creek Cap­i­tal Part­ners, Lon­gi­tude Cap­i­tal, Omega Funds, Lund­beck­fonden Ven­tures, PBM Cap­i­tal, Janus Hen­der­son In­vestors, Wood­line Part­ners LP, In­vus Cap­i­tal, and Alexan­dria Ven­ture In­vest­ments.

This sto­ry has been up­dat­ed to clar­i­fy that Ronald Crys­tal still holds his po­si­tion at Weill Cor­nell. 

Health­care Dis­par­i­ties and Sick­le Cell Dis­ease

In the complicated U.S. healthcare system, navigating a serious illness such as cancer or heart disease can be remarkably challenging for patients and caregivers. When that illness is classified as a rare disease, those challenges can become even more acute. And when that rare disease occurs in a population that experiences health disparities, such as people with sickle cell disease (SCD) who are primarily Black and Latino, challenges can become almost insurmountable.

David Meek, new Mirati CEO (Marlene Awaad/Bloomberg via Getty Images)

Fresh off Fer­Gene's melt­down, David Meek takes over at Mi­rati with lead KRAS drug rac­ing to an ap­proval

In the insular world of biotech, a spectacular failure can sometimes stay on any executive’s record for a long time. But for David Meek, the man at the helm of FerGene’s recent implosion, two questionable exits made way for what could be an excellent rebound.

Meek, most recently FerGene’s CEO and a past head at Ipsen, has become CEO at Mirati Therapeutics, taking the reins from founding CEO Charles Baum, who will step over into the role of president and head of R&D, according to a release.

Jacob Van Naarden (Eli Lilly)

Ex­clu­sives: Eli Lil­ly out to crash the megablock­buster PD-(L)1 par­ty with 'dis­rup­tive' pric­ing; re­veals can­cer biotech buy­out

It’s taken 7 years, but Eli Lilly is promising to finally start hammering the small and affluent PD-(L)1 club with a “disruptive” pricing strategy for their checkpoint therapy allied with China’s Innovent.

Lilly in-licensed global rights to sintilimab a year ago, building on the China alliance they have with Innovent. That cost the pharma giant $200 million in cash upfront, which they plan to capitalize on now with a long-awaited plan to bust up the high-price market in lung cancer and other cancers that have created a market worth tens of billions of dollars.

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Jay Bradner (Jeff Rumans for Endpoints News)

Div­ing deep­er in­to in­her­it­ed reti­nal dis­or­ders, No­var­tis gob­bles up an­oth­er bite-sized op­to­ge­net­ics biotech

Right about a year ago, a Novartis team led by Jay Bradner and Cynthia Grosskreutz at NIBR swooped in to scoop up a Cambridge, MA-based opthalmology gene therapy company called Vedere. Their focus was on a rather narrow market niche: inherited retinal dystrophies that include a wide range of genetic retinal disorders marked by the loss of photoreceptor cells and progressive vision loss.

But that was just the first deal that whet their appetite.

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Rafaèle Tordjman (Jeito Capital)

Con­ti­nu­ity and di­ver­si­ty: Rafaèle Tord­j­man's women-led VC firm tops out first fund at $630M

For a first-time fund, Jeito Capital talks a lot about continuity.

Rafaèle Tordjman had spotlighted that concept ever since she started building the firm in 2018, promising to go the extra mile(s) with biotech entrepreneurs while pushing them to reach patients faster.

Coincidentally, the lack of continuity was one of the sore spots listed in a report about the European healthcare sector published that same year by the European Investment Bank — whose fund is one of the LPs, alongside the American pension fund Teacher Retirement System of Texas and Singapore’s Temasek, to help Jeito close its first fund at $630 million (€534 million). As previously reported, Sanofi had chimed in €50 million, marking its first investment in a French life sciences fund.

FDA hands ac­cel­er­at­ed nod to Seagen, Gen­mab's so­lo ADC in cer­vi­cal can­cer, but com­bo stud­ies look even more promis­ing

Biopharma’s resident antibody-drug conjugate expert Seagen has scored a clutch of oncology approvals in recent years, finding gold in what are known as “third-gen” ADCs. Now, another of their partnered conjugates is ready for prime time.

The FDA on Monday handed an accelerated approval to Seagen and Genmab’s Tivdak (tisotumab vedotin-tftv, or “TV”) in second-line patients with recurrent or metastatic cervical cancer who previously progressed after chemotherapy rather than PD-(L)1 systemic therapy, the companies said in a release.

Dave Lennon, former president of Novartis Gene Therapies

Zol­gens­ma patent spat brews be­tween No­var­tis and Re­genxbio as top No­var­tis gene ther­a­py ex­ec de­parts

Regenxbio, a small licensor of gene therapy viral vectors spun out from the University of Pennsylvania, is now finding itself in the middle of some major league patent fights.

In addition to a patent suit with Sarepta Therapeutics from last September, Novartis, is now trying to push its smaller partner out of the way. The Swiss biopharma licensed Regenxbio’s AAV9 vector for its $2.1 million spinal muscular atrophy therapy Zolgensma.

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Time for round 2: Il­lu­mi­na-backed VC snags $325M for its next fund

Illumina Ventures closed off its second investment fund with a total commitment of $325 million, offering fresh fuel to back a slate of startups that have already included a smorgasbord of companies, covering everything from diagnostics to biotech drug development and genomics.

Fund II brings the total investment under Illumina Ventures’ oversight to $560 million, which has been focused on early-stage companies. And it has a transatlantic portfolio that includes SQZ, Twist and Encoded Therapeutics.

Volker Wagner (L) and Jeff Legos

As Bay­er, No­var­tis stack up their ra­dio­phar­ma­ceu­ti­cal da­ta at #ES­MO21, a key de­bate takes shape

Ten years ago, a small Norwegian biotech by the name of Algeta showed up at ESMO — then the European Multidisciplinary Cancer Conference 2011 — and declared that its Bayer-partnered targeted radionuclide therapy, radium-223 chloride, boosted the overall survival of castration-resistant prostate cancer patients with symptomatic bone metastases.

In a Phase III study dubbed ALSYMPCA, patients who were treated with radium-223 chloride lived a median of 14 months compared to 11.2 months. The FDA would stamp an approval on it based on those data two years later, after Bayer snapped up Algeta and christened the drug Xofigo.

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