Back­ers of Tes­la and SpaceX fund 29-year-old Al­ice Zhang's AI-pow­ered neu­ro­science start­up

The bat­tered field of neu­ro­science has a dogged new play­er: a team of young, rene­gade PhDs who say they’re har­ness­ing ge­nomics and ar­ti­fi­cial in­tel­li­gence to re­vive the ail­ing in­dus­try.

Al­ice Zhang

The San Fran­cis­co ven­ture is called Verge Ge­nomics, and it’s led by a spunky 29-year-old PhD dropout — Al­ice Zhang — who says she’s de­ter­mined to push neu­ro­science R&D out of its decades-long slump. Jump­ing to her cause is DFJ Ven­tures, a tech in­vestor who has the likes of Twit­ter, SpaceX, and Tes­la in its port­fo­lio. The VC firm led Verge’s $32 mil­lion Se­ries A round, which was an­nounced this morn­ing. It’s not DFJ’s first rodeo in the field, how­ev­er, as it’s al­ready backed ge­nomics A-lis­ters like Hu­man Longevi­ty and Syn­thet­ic Ge­nomics.

But it’s not just tech mon­ey that’s back­ing Verge. Join­ing DFJ are a num­ber of biotech in­vestors, in­clud­ing WuXi and the ALS In­vest­ment Fund. That’s be­cause Verge isn’t strict­ly a tech com­pa­ny, nor is it strict­ly a drug­mak­er, Zhang tells me. “We’re ex­act­ly in the mid­dle,” she says.

Verge is build­ing a mas­sive data­base — one of the largest in the field, they say — of ge­nom­ic pa­tient da­ta from ALS and Parkin­son’s pa­tients. The start­up is team­ing up with a dozen uni­ver­si­ties and gov­ern­ment or­ga­ni­za­tions to get their hands on pa­tient brain sam­ples from those who have passed away from neu­ro con­di­tions. Once at Verge, the brain sam­ples are se­quenced and the da­ta are fed to the com­pa­ny’s ma­chine learn­ing soft­ware. The plan, of course, is to cull some in­sights from this da­ta, then de­ter­mine some promis­ing drug tar­gets and build out the com­pa­ny’s pipeline.

“Neu­ro­science is at least a decade be­hind can­cer in terms of lever­ag­ing com­pu­ta­tion­al tech­niques and da­ta,” Zhang says. “In ad­di­tion to ma­chine learn­ing, we’re go­ing through a re­nais­sance in neu­ro­bi­ol­o­gy with ad­vances in sin­gle cell se­quenc­ing and our un­der­stand­ing of the cir­cuit­ry of the brain.”

Bring­ing to­geth­er these ad­vance­ments in bi­ol­o­gy and tech­nol­o­gy, Zhang says she thinks neu­ro­science can progress to­ward pre­ci­sion med­i­cine the way can­cer al­ready has. The com­pa­ny says it al­ready has lead pro­grams in ALS and Parkin­son’s, and plans to tack­le Alzheimer’s as well.

I asked Zhang if she re­ceived any op­po­si­tion to her “AI-pow­ered drug dis­cov­ery” pitch while fundrais­ing — es­pe­cial­ly from in­vestors con­cerned about hype vs. re­al­i­ty.

“There’s a lot of AI com­pa­nies out there, and that begs the ques­tion — is it hype or is it hope?” Zhang said. “The skep­ti­cism is war­rant­ed when some­one comes along and says they can fix a prob­lem that’s been his­tor­i­cal­ly chal­leng­ing.”

The way Verge fought the op­po­si­tion was to “gen­er­ate com­pelling da­ta that sup­ports our claims,” Zhang said. “We could do that on both the tech­nol­o­gy and the life sci­ence side be­cause we had good bi­o­log­i­cal hy­pothe­ses.” In sup­port of that, Zhang points to a pa­per Verge col­lab­o­rat­ed with USC on (pub­lished in Na­ture in 2018) that de­scribed how gene mu­ta­tion caused tox­i­c­i­ty to nerve cells, lead­ing to ALS and some forms of de­men­tia.

In Zhang’s view, the soft­ware-on­ly com­pa­nies — and the com­pa­nies that aren’t build­ing their own data­bas­es — are the risky bets. The AI com­pa­nies ris­ing to the top, she says, are ones that in­te­grate drug de­vel­op­ment with the soft­ware side. Af­ter all, a suc­cess­ful drug is the big mon­ey­mak­er.

“One of the rea­sons why ma­chine learn­ing and ar­ti­fi­cial in­tel­li­gence hasn’t had more trac­tion in drug dis­cov­ery is be­cause si­los ex­ist be­tween the com­pu­ta­tion­al side and drug dis­cov­ery side. It’s im­por­tant to have an in­te­grat­ed team sit­ting side-by-side to de­vel­op a drug.”

Emi­ly Melton

That’s what they’re all about at Verge. The 14-per­son com­pa­ny has 10 PhDs in fields like ma­chine learn­ing, neu­ro­science, drug de­vel­op­ment, ap­plied math, bio­physics, and sta­tis­tics. Join­ing the team’s board of di­rec­tors is DFJ part­ner Emi­ly Melton.

“The sub­stan­tial in­crease in da­ta vol­umes com­bined with the ap­pli­ca­tion of ma­chine learn­ing tools has the po­ten­tial to trans­form drug dis­cov­ery and de­vel­op­ment,” Melton said in a news re­lease. “We were com­pelled by the high-cal­iber and mul­ti­dis­ci­pli­nary team at Verge Ge­nomics and their vi­sion to lever­age the con­ver­gence of tech­no­log­i­cal and neu­ro­bi­o­log­i­cal ad­vances to dis­cov­er new ther­a­pies for these com­plex dis­eases.”


Im­age: The team at San Fran­cis­co’s Verge Ge­nomics. VERGE GE­NOMICS

Mi­no­ryx and Sper­o­genix ink an ex­clu­sive li­cense agree­ment to de­vel­op and com­mer­cial­ize lerigli­ta­zone in Chi­na

September 23, 2020 – Hong Kong, Beijing, Shanghai (China) and Mataró, Barcelona (Spain)  

Minoryx will receive an upfront and milestone payments of up to $78 million, as well as double digit royalties on annual net sales 

Sperogenix will receive exclusive rights to develop and commercialize leriglitazone for the treatment of X-linked adrenoleukodystrophy (X-ALD), a rare life-threatening neurological condition

FDA chief Stephen Hahn on Capitol Hill earlier this week (Getty Images)

As FDA’s work­load buck­les un­der the strain, Trump again ac­cus­es the agency of a po­lit­i­cal hit job

Peter Marks appeared before a virtual SVB Leerink audience yesterday and said that his staff at FDA’s CBER is on the verge of working around the clock. Manufacturing inspections, policy work and sponsor communications have all been pushed down the to-do list so that they can be responsive to Covid-related interactions. And the agency’s objective right now? “To save as many lives as we can,” Marks said, likening the mortality on the current outbreak as equivalent to “a nuclear bomb on a small city.”

David Berry (Flagship)

Flag­ship's next big tech­no­log­i­cal bet? The cloud

Earlier this month, Flagship announced their big bet on the software half the industry is talking about, launching the AI and machine learning startup. Now, they and a couple other investors are gambling $100 million on a software that much of the public generally thinks of as a cool, IT afterthought: cloud computing.

The idea, says founder and Flagship partner David Berry, is one of scale: The sheer magnitude of biological data that you can store on cloud technology is unprecedented. And that size, when leveraged properly, can allow you to ask questions and form insights that are similarly unprecedented.

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Patrick Enright, Longitude co-founder (Longitude)

As its biotechs hit the pan­dem­ic ex­it, Lon­gi­tude rais­es $585M for new neu­ro, can­cer, ag­ing and or­phan-fo­cused fund

The years have been kind to Longitude Capital. This year, too.

A 2006 spinout of Pequot Capital, its founders started their new firm just four years before the parent company would go under amid insider trading allegations. Their first life sciences fund raised $325 million amid the financial crisis, they added a second for $385 million and then in, 2016, a third for $525 million. In the last few months, the pandemic biotech IPO boom netted several high-value exits from those funds, as Checkmate, Vaxcyte, Inozyme and Poseida all went public.

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The win­dow is wide open as four more biotechs join the go-go IPO class of 2020

It’s another day of hauling cash in the biopharma world as four more IPOs priced Friday and a fifth filed its initial paperwork.

The biggest offering comes from PMV Pharma, an oncology biotech focusing on p53 mutations, which raised $211.8 million after pricing shares at $18 apiece. Prelude Therapeutics, developing PRMT5 inhibitors for rare cancers, was next with a $158 million raise, pricing shares at $19 each. Graybug Vision raised $90 million after pricing at $16 per share for its wet AMD candidates, and breast cancer biotech Greenwich Lifesciences brought up the rear with a small, $7 million raise after pricing shares at $5.75.

J&J of­fers PhI/IIa da­ta show­ing its sin­gle-dose vac­cine can stir up suf­fi­cient im­mune re­sponse

Days after J&J dosed the first participants of its Phase III ENSEMBLE trial, the pharma giant has detailed the early-stage data that gave them confidence in a single-dose regimen.

Testing two dose levels either as a single dose or in a two-dose schedule spaced by 56 days in, the scientists from Janssen, the J&J subsidiary developing its vaccine, reported that the low dose induced a similar immune response as the high dose. The interim Phase I/IIa results were posted in a preprint on medRxiv.

Daniel O'Day, Gilead CEO (Kevin Dietsch/UPI/Bloomberg via Getty Images)

Play-by-play of Gilead­'s $21B Im­munomedics buy­out de­tails a fren­zied push — and mints a new biotech bil­lion­aire

Immunomedics had not really been looking for a buyout when the year began. Excited by its BLA for Trodelvy, submitted to the FDA in late 2019, executive chairman Behzad Aghazadeh started off looking for potential licensing deals and zeroed in on four potential partners, including Gilead, following January’s JP Morgan Healthcare Conference in San Francisco. Such talks advanced throughout the year, with discussions advancing to the second round in mid-August.

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President Donald Trump reacts after signing an executive order following his remarks on his healthcare policies yesterday in Charlotte, North Carolina (Getty Images)

Op-ed: Will phar­ma re­al­ly pay for Trump’s lat­est law­less promise to 33 mil­lion Medicare ben­e­fi­cia­ries? Not like­ly

Sitting atop the executive branch, President Donald Trump is the ultimate authority at the FDA. He can fast track any vaccine to approval himself. If it came to that, of course.

What he can’t do is unilaterally order the legislative branch to loosen the Treasury’s coffers for $6.6 billion. Nor can he command pharmaceutical companies to pay for $200 vouchers sent to 33 million Medicare beneficiaries for prescription drugs before the election.

Pal­la­dio bags $20 mil­lion Se­ries B to top­ple a prob­lem­at­ic kid­ney dis­ease drug

Palladio Biosciences just took one step further in its quest to topple Otsuka’s Samsca with its own — it hopes safer — autosomal dominant polycystic kidney disease (ADPKD) drug.

The Pennsylvania-based biotech announced a $20 million Series B on Friday, which will fund a 10-person Phase III trial of its vasopressin V2 receptor agonist, lixivaptan. CEO Alex Martin expects to read out data in the first half of next year, then launch straight into a larger pivotal Phase III study with about 1,200 participants.