CEO Shawn Leland (Elevation)

El­e­va­tion On­col­o­gy bags $65M to push failed Mer­ri­mack drug through PhII

Shawn Le­land hadn’t even heard of NRG1 as an on­col­o­gy tar­get un­til he was sit­ting in a pre­sen­ta­tion at ES­MO 2018 in Mu­nich. Alex Drilon, an on­col­o­gist at the Memo­r­i­al Sloan Ket­ter­ing Can­cer Cen­ter in New York, was pre­sent­ing on tar­get­ed ther­a­pies for lung can­cer — and Le­land was en­thralled.

“He put up one slide with­in that pre­sen­ta­tion that de­scribed the tar­get of NRG1 gene fu­sion and the fact that they were po­ten­tial­ly drug­gable with a HER3 mon­o­clon­al an­ti­body ap­proach,” Le­land said.

The wheels be­gan turn­ing. Af­ter the pre­sen­ta­tion, he pulled a bunch of lit­er­a­ture on NRG1 fu­sion and be­gan re­search­ing.

In Ju­ly, Le­land un­veiled a start­up, El­e­va­tion On­col­o­gy, with a $32.5 mil­lion Se­ries A round and a clin­i­cal can­di­date for sol­id tu­mors with NRG1 ge­nom­ic fu­sion. And on Wednes­day, he land­ed a $65 mil­lion Se­ries B to com­plete en­roll­ment in the can­di­date’s Phase II tri­al, and a pro­mo­tion. Le­land’s tak­ing over from in­ter­im CEO Steve Elms, who will re­main chair of El­e­va­tion’s board of di­rec­tors. And Drilon, who in­spired Le­land at ES­MO, is on the biotech’s sci­en­tif­ic ad­vi­so­ry board.

“There is this unique abil­i­ty to go out and get a li­cense or ac­quire a HER3 mon­o­clon­al an­ti­body and re­pur­pose it for this ge­net­i­cal­ly de­fined pa­tient pop­u­la­tion, where a HER3 mon­o­clon­al an­ti­body ap­proach was very much tai­lored to the dis­ease bi­ol­o­gy,” Le­land said.

The biotech ac­quired its lead can­di­date, Mer­ri­mack’s high-pro­file serib­an­tum­ab, last year for up to $58 mil­lion. The drug pre­vi­ous­ly flunked a Phase II tri­al eval­u­at­ing its ef­fi­ca­cy in non-small cell lung can­cer in com­bi­na­tion with do­c­etax­el — but un­like Mer­ri­mack, El­e­va­tion isn’t fo­cused on HER3 am­pli­fi­ca­tions and over­ex­pres­sion. It’s tar­get­ing that NRG1 fu­sion, which Le­land says is more ac­tive in dri­ving tu­mor growth.

“If you’re able to iden­ti­fy … these NRG1 gene fu­sions, it’s high­ly un­like­ly that they have an­oth­er ge­nom­ic aber­ra­tion that may be lead­ing to the growth of their can­cer,” Le­land said.

Mer­ri­mack’s serib­an­tum­ab flop was one of sev­er­al for the com­pa­ny. Af­ter the can­di­date and do­c­etax­el failed to show im­prove­ments in the pro­gres­sion-free sur­vival of NSCLC pa­tients com­pared to do­c­etax­el treat­ments alone, the biotech added it to the scrap heap and slashed 60% of its staff. Last Ju­ly, the com­pa­ny’s ex­ec­u­tives fled the scene.

Le­land is now hop­ing to turn around an ac­cel­er­at­ed ap­proval for serib­an­tum­ab with re­sults from the biotech’s open-la­bel Phase II CRE­STONE study. The Se­ries B will be used to fin­ish en­rolling a to­tal of 75 pa­tients across three co­horts.

The round was led by Cor­morant As­set Man­age­ment, ven­Bio Part­ners, with help from a slate of new and old in­vestors in­clud­ing: Box­er Cap­i­tal of Tavi­s­tock Group, Janus Hen­der­son, Sam­sara Bio­cap­i­tal, and Vi­vo Cap­i­tal, Ais­ling Cap­i­tal, Ver­tex Ven­tures, Qim­ing Ven­ture Part­ners USA, Driehaus Cap­i­tal Man­age­ment, and BVF Part­ners. Back-to-back rais­es and in­volve­ment from Cor­morant, which is known as a crossover play­er, would typ­i­cal­ly in­di­cate an IPO is on the way. But El­e­va­tion re­spond­ed:

A fu­ture IPO is a pos­si­bil­i­ty, al­though the Com­pa­ny has no im­me­di­ate plans to file. The Se­ries B po­si­tions the Com­pa­ny with a strong base of crossover in­vestors to sup­port a pub­lic list­ing if that is the most fa­vor­able route for ad­di­tion­al fund­ing, based on mar­ket con­di­tions at the time.

“There’s lim­it­ed to no op­tions for these pa­tients, and the abil­i­ty for them to get a ther­a­py on a clin­i­cal tri­al, with an agent like serib­an­tum­ab that’s unique­ly tai­lored to this dis­ease bi­ol­o­gy as­so­ci­at­ed with the NRG1 fu­sion, we be­lieve is key,” Le­land said. “I think it’s one of those tar­gets that, you know, caught a lot of at­ten­tion as of late, but up un­til prob­a­bly the past 12 to 24 months pri­or to that, there was very lit­tle known about NRG1.”

El­e­va­tion faces com­pe­ti­tion from Rain Ther­a­peu­tics’ tar­lox­o­tinib and Merus’ MCLA-128, both of which are al­so in Phase II. The race is tight, but Le­land ex­pects to read out in­ter­im da­ta by mid-2021.

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RBC Capital Markets explores what is material in ESG for biopharma companies with the ESG leads at Gilead Sciences. Gilead has long focused on sustainability but recognized a more robust framework was needed. Based on a materiality assessment, Gilead’s ESG strategy today focuses first on drug access and pricing, while also addressing D&I and climate change. Find out why Gilead’s board is “acutely aware” of the contribution that ESG makes to firm’s overall success.

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Sen. Ron Wyden (D-OR) with reporters in the Senate Subway (Graeme Sloan/Sipa via AP Images)

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Emma Walmsley, GlaxoSmithKline CEO (Credit: Fang Zhe/Xinhua/Alamy Live News)

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