Biotech companies typically knock on Nasdaq’s doors with several rounds of financing under their belt. Equillium, however, went straight for it.
Having reaped a $65.4 million IPO last month, the San Diego-based biotech is emerging from stealth mode to discuss for the first time that atypical route — a somewhat unexpected one, CEO Dan Bradbury would add — and the atypical arrangement that made it possible for an operation that only launched 18 months ago.
Equillium licensed North American rights to its one and only drug, itolizumab, from Indian biosimilar giant Biocon. Sold in India as a psoriasis treatment, the same drug has been rechristened EQ001 and is being developed for a number of other immuno-inflammatory diseases.
Bradbury — who has known Biocon founder Kiran Mazumdar-Shaw since his days as CEO of diabetes drugmaker Amylin and currently sits on the Biocon board — says Equillium’s approach is novel in the sense that recent advances in immunology has allowed his team to “rediscover” a product that was developed in the 2000s to hit a target, CD6, first discovered in the 1980s.
Inhibiting CD6, new research has found, blocks effector T cell activity without tampering with regulatory T cells, a selective approach compared to some “brute force” biologics currently on the market, he says.
At the same time, he adds, since itolizumab is already clinically validated and manufactured at commercial scale, “it’s actually a fairly late-stage program relative to many programs that have gone public in the biotechnology space.”
Soon after Equillium licensed the drug, Biocon completed “a large amount of work” needed to demonstrate that the product it was manufacturing for Equillium was biocomparable to what it was selling on the market, as they are manufactured on different cell lines. It also wrapped a Phase I study for both subcutaneous and IV forms of EQ001 in Australia (though part of the trial was terminated early, according to the S-1) and got a thumbs up from the FDA regarding the manufacturing facility it’s using to make biosimilars to be sold in the US — all good news for Equillium.
That’s probably part of what attracted the encouragement from public investors, many of whom had also worked with Bradbury before Amylin was sold to Bristol-Myers Squibb for $5.3 billion. The other part? All the clinical plans lined up for 2019: Phase Ib/II aGVHD trial early on; Phase II cGVHD trial in H1; and proof-of-concept in severe asthma, with a goal to choose an additional indication before wrapping up the year.
All told, the cash runway should extend to the next 24 months after going public at $14, the low end of the range. The stock has edged up, though, and is now riding above $15 per share. The market cap is a modest $277 million.
And Equillium can do all this without worrying about manufacturing: Aside from a 13.9% stake in the company, Biocon isn’t charging anything for supplying itolizumab for testing in up to three orphan indications. Production cost of additional products, the $30 million promised in regulatory milestones and $565 million sales payments won’t be due until — or if — Equillium nabs its first approval in the US.
Meanwhile, Bradbury adds, Equillium’s “small but mighty” team of 11 is still on the hunt for additional assets to beef up its immunology pipeline.
Bradbury and Bruce Steel, a co-founder of the company now serving as president and CBO, own the largest chunks of stocks at 22.1% each. Stephen Connelly — co-founder, CSO and Steel’s former colleague at BioMed Ventures — is in for 7.7%.
Image: Dan Bradbury. EQUILLIUM
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