Add ear gene therapy company Akouos to the ever-growing list of IPOs amid Covid-19
For investors looking to cash in on a burgeoning ear therapy space, the latest biotech angling for a public debut could be music to their ears.
Fresh off a $105 million raise in March, ear gene therapy company Akouos is looking for another $100 million for a chance to dance on the Nasdaq well before its lead product enters the clinic.
Hearing aids and cochlear implants do address ear damage caused by genetics, noise, aging, or drugs, but nothing quite cures or indeed targets the biological underpinnings of hearing loss — this is the gap Akouos and a handful of others in the space want to bridge.
“I think some of the early efforts in the hearing space have been drawn to the largest affected populations where there happens to be less clarity on the underlying biology mechanism,” chief Manny Simons said in a previous interview with Endpoints News. “So we’re focusing our attention on forms of hearing loss that we feel are well-understood, well-characterized, where we can potentially address the underlying cause.”
The company’s lead experimental therapy AK-OTOF is engineered to treat hearing loss due to mutations in the gene that encodes otoferlin, a protein that enables the sensory cells to activate auditory neurons that carry electronically encoded acoustic information to the brain, which allows us to hear. Akouos plans to submit an application to take the drug into human studies next year, and generate early-stage data in 2022.
Simons, who founded the company in 2016, initially flirted with the idea of becoming a musician, growing up playing the piano and the trumpet. He met his wife at a glee club at Harvard. For his bachelor’s degree, he had the opportunity to essentially create his own course of study: to understand how the brain processes music, on the basis of imaging studies. That path led to the ear — to decipher how sound is encoded into a neural impulse that can extend deep into the brain.
After getting his first taste of entrepreneurship in the prolific lab of drug delivery researcher Bob Langer, he got his biopharma training wheels off with stints at Third Rock backed-Warp Drive Bio and Voyager Therapeutics (neither of which were ear focused). But when he learned that AAV vectors with potential applications for the ear were being developed in a laboratory at Massachusetts Eye and Ear, Simons seized the opportunity to get a hearing-focused gene therapy company off the ground.
After securing a sweet $7.5 million in seed funding in 2018, Akouos scored $50 million in a Series A round in 2018, led by 5AM and New Enterprise Associates.
Akouos, akin to some others in the gene and cell therapy space, is investing heavily in manufacturing infrastructure — having taken note that the complex manufacturing process for these kinds of therapies has become something of an Achilles heel in the field when it comes to adoption if the production apparatus is not up to scratch. For instance, the uptake of CAR-T therapies — Novartis’ Kymriah and Gilead’s Yescarta — underwhelmed initial expectations, despite their abundant promise. The uptake of Kymriah was plagued by manufacturing problems, and despite Novartis’ attempt to expand its capacity, sales have disappointed commercially, giving Yescarta an edge in the market.
Akouos is building its own infrastructure to manufacture vectors for its slate of experimental therapies, which also include genetic medicines for the most common forms of hearing loss, such as age-related and noise-induced hearing loss. The company is also planning on building a plant to process gene therapy batches to support activities through Phase I/II clinical trials for product candidates beyond AK-OTOF — partner Lonza will help manufacture AK-OTOF while it is shepherded through clinical development.
The company plans to list on the Nasdaq under the symbol ‘AKUS’ amid a broader rush of biopharma companies that are making their way to the public markets despite the disruption of Covid-19. Indeed, investor appetites have appeared seemingly insatiable given the raft of splashy IPOs in recent weeks, including a $424 million debut for a J&J-partnered Chinese biotech Legend Biotech, marking one of the largest public raises in biotech history.
Meanwhile, there are a host of rivals in the broader ear-focused space. Also in Boston, Akouos’ home, is Decibel Therapeutics, working on regeneration by targeting tiny hairs that grow in the inner ear to address congenital hearing loss or age-related balance disorders. Frequency Therapeutics has a mid-stage hair cell regeneration program using progenitor cells.
Across the Atlantic, UK-based Rinri Therapeutics is working on treating hearing loss by transplanting otic neural progenitor cells into the inner ear. Amsterdam-based Audion Therapeutics has a compound in-licensed from Eli Lilly, which is designed to turn on a chemical switch to produce new sensory hair cells from other cells in the inner ear to improve hearing.