Adam Kop­pel and Jeff Schwartz are done rais­ing cap­i­tal. Now they have $720M to do some se­ri­ous deals at Bain

Adam Kop­pel

When Adam Kop­pel looped back to Bain Cap­i­tal last sum­mer, where he had al­ready wired him­self in­to the health­care fi­nance field, he im­me­di­ate­ly paired back up with long­time part­ner-in-arms, Jeff Schwartz, and be­gan to cre­ate a new life sci­ences fund with enough cap­i­tal on hand to make a deep im­pact on the biotechs they would choose to back.

To­day marks the of­fi­cial end of the fundrais­ing pe­ri­od and the be­gin­ning of a 3- to 5-year stint spend­ing all of their time in­vest­ing the $720 mil­lion the two have raised; $600 mil­lion of that from ex­ter­nal sources with the oth­er $120 mil­lion from Bain part­ners.

Jeff Schwartz

Orig­i­nal­ly they had eyed gar­ner­ing some­thing more than $500 mil­lion in ex­ter­nal cash. By the time they hit $600 mil­lion and Bain kicked in the rest, it seemed like they had the right amount to do what they want­ed to do.

And what do they want to do?

Kop­pel, Schwartz and their grow­ing team — which in­cludes part­ner Jeff Green, who on­ly re­cent­ly joined Bain af­ter a stint at Citadel — have four ba­sic types of com­pa­nies in which they plan to in­vest.

1. In­flec­tion cap­i­tal, not blue sky ven­ture start­up cap­i­tal, they say, fo­cused on com­pa­nies that have de-risked them­selves to some sig­nif­i­cant ex­tent with late an­i­mal or ear­ly hu­man da­ta. These would be biotechs look­ing to gain al­ter­na­tive cap­i­tal that they may oth­er­wise look to the pub­lic mar­kets or a strate­gic trans­ac­tion for.

2. Growth cap­i­tal for com­pa­nies that are at or near achiev­ing rev­enue, look­ing to re­al­ly ac­cel­er­ate their busi­ness at just the right time.

3. Fall­en an­gels, gen­er­al­ly pub­lic com­pa­nies look­ing to ac­cess cap­i­tal but dam­aged enough that they don’t want to do it through an­oth­er stock of­fer­ing at ter­ri­ble terms.

4. Fi­nal­ly, a few large eq­ui­ty trans­ac­tions, but on­ly along­side their Bain col­leagues con­tribut­ing a por­tion of the funds. “You can think larg­er, ma­ture com­pa­nies with cash-flow gen­er­a­tive prop­er­ties,” says Schwartz, “that need op­ti­miza­tion, any­where across the life sci­ence spec­trum.”

Kop­pel and Schwartz plan to be se­lec­tive, work­ing 5 to 6 or 7 deals a year in to­tal in a big world of biotechs, de­vice com­pa­nies and di­ag­nos­tics groups. But you can rule out ser­vices and IT.

Their group has al­ready made a cou­ple of in­vest­ments that help il­lus­trate its fo­cus. Bain and RA Cap­i­tal — which shares some, though not all, of the same goals — led a crossover round for Sol­id Bio­sciences, found­ed by Duchenne dad and for­mer JP Mor­gan in­vest­ment banker Ilan Gan­ot. And the Bain guys al­so backed Dicer­na Phar­ma­ceu­ti­cals $DR­NA with a $70 mil­lion pre­ferred stock deal, al­so along­side RA Cap­i­tal and some oth­ers.

Yes, 2012 to 2016 saw a lot of new biotech IPOs, com­ments Kop­pel, “but a num­ber of these com­pa­nies are go­ing to need to raise cap­i­tal again, and they’re trad­ing at cash or be­low.” That’s where they plan to step in.

It’s not a rush deal. Kop­pel, Schwartz and the group have been steadi­ly build­ing a pipeline of deals. Their role: “Pa­tient, longterm-think­ing cap­i­tal to a small num­ber of man­age­ment teams we re­al­ly be­lieve in and want to work with for a few years.”

Work­ing at Bio­gen was a “ter­rif­ic ex­pe­ri­ence,” says Kop­pel, who wrapped a 2-year stint as chief strat­e­gy of­fi­cer. It gave him an in­side view not on­ly to the peo­ple and com­pa­nies that dom­i­nate this busi­ness, but an in­side look at the think­ing that goes on at the top 15 bio­phar­ma com­pa­nies and how they go about do­ing their deals, in­clud­ing the way they work with small com­pa­nies. That’s the kind of in­sight he can share with the com­pa­nies they choose to in­vest in.

It’s a way of be­ing wired in with per­spec­tive about all sides of the busi­ness. And he plans to build that in­to a suc­cess­ful strat­e­gy for Bain and all his part­ners.

Michel Vounatsos, Biogen CEO (via YouTube)

UP­DAT­ED: Bio­gen spot­lights a pair of painful pipeline set­backs as ad­u­canum­ab show­down looms at the FDA

Biogen has flagged a pair of setbacks in the pipeline, spotlighting the final failure for a one-time top MS prospect while scrapping a gene therapy for SMA after the IND was put on hold due to toxicity.

Both failures will raise the stakes even higher on aducanumab, the Alzheimer’s drug that Biogen is betting the ranch on, determined to pursue an FDA OK despite significant skepticism they can make it with mixed results and a reliance on post hoc data mining. And the failures are being reported as Biogen was forced to cut its profit forecast for 2020 as a generic rival started to erode their big franchise drug.

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A new chap­ter in the de­cen­tral­ized clin­i­cal tri­al ap­proach

Despite the promised decentralized trial revolution, we haven’t yet moved the needle in a significant way, although we are seeing far bolder commitments to this as we continue to experience the pandemic restrictions for some time to come. The vision of grandeur is one thing, but operationalizing and execution are another and recognising that change, particularly mid-flight on studies, is worthy of thorough evaluation and consideration in order to achieve success. Here we will discuss one of the critical building blocks of a Decentralized and Remote Trial strategy: TeleConsent; more than paper under glass, it is a paradigm change and key digital enabler.

Stephen Hoge, Moderna president (Moderna)

On morn­ing of FDA Covid-19 ad­comm, Mod­er­na com­pletes PhI­II en­roll­ment, putting them neck-and-neck with Pfiz­er

Weeks away from a potential EUA application, Moderna announced they have completed enrollment in their 30,000-person Phase III Covid-19 vaccine trial, with over a third of volunteers non-white and a quarter over the age of 65.

The announcement caps what has been the most closely-watched recruitment race in the history of drug development, as Pfizer and Moderna rushed to get enough volunteers to prove whether or not experimental vaccines could actually protect people from contracting Covid-19. Pfizer reached that mark on Sept. 15. Moderna said around the same time that they would slow down enrollment to ensure they enrolled enough participants from minority and at-risk groups.

Can B cells break the bound­aries of cell ther­a­py? Long­wood start­up has $52M to prove a new en­gi­neer­ing tech

Back in December 2017, as the cell therapy world was still basking in the virtually back-to-back approvals of two pioneering CAR-Ts, researchers at Seattle Children’s Research Institute reported a scientific first in a different corner of the field: engineer B cells to treat disease.

The team, led by David Rawlings and Richard James, eventually worked with Longwood Fund to start a biotech around those findings. And now Atlas Venture and RA Capital Management are coming on board to lead a $52 million launch round, joined by Alta Partners, for Be Biopharma.

Pfiz­er scoops up an an­tibi­ot­ic in rare M&A deal, bag­ging a vir­tu­al start­up op­er­at­ing on a shoe­string bud­get

Pfizer is stepping up with a rare antibiotics buyout deal today, grabbing Palo Alto, CA-based Arixa Pharmaceuticals in a bid to add a new oral version of avibactam, a beta lactamase inhibitor — or BLI — approved back in 2015 as part of the IV treatment Avycaz.

The Arixa acquisition follows some encouraging Phase I responses demonstrating that 60% to 80% of the oral drug is absorbed into the bloodstream. Only 7% of the IV version is absorbed orally, far below the 30% threshold Arixa has pointed to as a therapeutic threshold. The buyout gives Pfizer’s hospital group a line on a new oral combo with antibiotics like ceftibuten to go after drug-resistant cases of urinary tract infections and other ailments.

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Bo Cumbo, AavantiBio CEO (file photo)

Bo Cum­bo jumps from the top com­mer­cial post at Sarep­ta to the helm of a gene ther­a­py start­up with some in­flu­en­tial back­ers, big plans and $107M

After a 7-year stretch building the commercial team at Sarepta, longtime drug salesman Bo Cumbo is jumping to the entrepreneurial side of the business, taking the helm of a startup that’s got several deep-pocket investors. And he’s not just bringing his experience in selling drugs.

He tells me that when he told Sarepta CEO Doug Ingram about it, his boss got excited about the venture and opted to jump in with a $15 million investment from Sarepta to add to the launch money, alongside 3 of the busiest investors in biotech.

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John Maraganore, Alnylam CEO (Scott Eisen/Bloomberg via Getty Images)

With lumasir­an on the FDA's doorstep, Al­ny­lam reads out new PhI­II da­ta in PH1

Just over a month away from its December PDUFA date, Alnylam flaunted new data from two Phase III studies to back lumasiran in primary hyperoxaluria type 1 (PH1), a rare liver condition.

The Cambridge, MA-based biotech snagged a priority review for the candidate back in June, and got positive feedback from the EMA’s Committee for Medicinal Products for Human Use just last week. Lumasiran uses RNA interference (RNAi) to silence the gene for glycolate oxidase, an enzyme used in the production of oxalate.

News brief­ing: UK biotech 4D phar­ma heads for Nas­daq via SPAC; Dr. Red­dy's shuts down man­u­fac­tur­ing af­ter cy­ber­at­tack

Another pharma company is intending to use a SPAC to join the Nasdaq.

4D pharma, a UK-based biotech, is reverse-merging with a blank check company in a deal worth up to $37.6 million. The move will give 4D pharma a new Nasdaq ticker, which will be $LBPS, using the American Depositary Share program. 4D will continue to trade on the London stock exchange under its previous ticker.

As a result of the move, 4D pharma will gain $14.6 million in cash held by the blank check company, dubbed Longevity $LOAC. The merger is expected to be completed in early 2021, after which shares will be immediately tradeable on Nasdaq.

CEO Marc Gleeson (Azura)

Azu­ra Oph­thalmics gets a $20M boost for its R&D work on eye dis­eases

Three years after closing a $16 million Series B, the same group of investors are back to give Azura Ophthalmics a $20 million boost.

That brings the Tel Aviv-Yafo, Israel-based biotech’s total fundraise to $38 million, and should pave the way for a registration study of its lead candidate in Meibomian gland dysfunction (MGD) and related eye diseases, CEO Marc Gleeson told Endpoints News.

The topical candidate, dubbed AZR-MD-001, is designed to address abnormal hyperkeratinization, or the build-up and shedding of proteins at the opening of or within the Meibomian gland. When Meibomian glands become dysfunctional, rapid evaporation of the tear film can occur, leading to dry eye disease.