French VC Sev­en­ture fo­cus­es sec­ond fund on fer­tile mi­cro­bio­me field — tar­gets €200M-plus

A few years ago, the spec­tac­u­lar fail­ure of Seres Ther­a­peu­tics’ sem­i­nal ef­fort in­to de­vel­op­ing a “crap­sule” — a syn­thet­ic, fer­ment­ed mi­cro­bio­me ther­a­peu­tic de­rived by a man­u­fac­tur­ing process that does not re­quire hu­man donor ma­te­r­i­al — de­railed an emerg­ing field work­ing to har­ness the in­sights gained from gut mi­cro­bio­ta to de­vel­op drugs. But since then, the suc­cess of fe­cal trans­plant ther­a­pies to treat stub­born­ly re­cur­rent C. diff in­fec­tions has en­tered the bio­phar­ma zeit­geist, at­tract­ed a buck­et of biobucks and even in­spired the takeover of a key play­er, Re­bi­otix. The ther­a­peu­tic ef­fort has resurged along­side a bur­geon­ing in­ter­est in nu­tri­tion — think pro­bi­otics. French VC Sev­en­ture Part­ners has fin­gers in every mi­cro­bio­me pie — drugs, di­ag­nos­tics, dig­i­tal of­fer­ings and nu­tri­tion — and it has launched its sec­ond ded­i­cat­ed mi­cro­bio­me fund with a tar­get of more than €200 mil­lion.

Is­abelle de Cre­moux

Un­sur­pris­ing­ly, the biggest cap­i­tal in­jec­tion is re­served for ther­a­peu­tics com­pared to the re­main­ing three cat­e­gories, Is­abelle de Cre­moux, man­ag­ing part­ner of Sev­en­ture Part­ners, who led the fund rais­ing, told End­points News. The first two in­vest­ments from the fund, dubbed Health for Life Cap­i­tal (HFL) II, have al­ready been made in US-based Ax­i­al Bio­ther­a­peu­tics ($25 mil­lion round) and Den­mark-based Galec­to Biotech (€79 mil­lion round), she said, de­clin­ing to pro­vide de­tails on the val­ue of each in­vest­ment.

“When I raised HFL I more than four years ago, my client list was not very long, we would have to ex­plain what it (the mi­cro­bio­me field) was in the first parts of meet­ings — for HFL II it has com­plete­ly changed, most are aware of what it is,” she said.

HFL II was launched this Jan­u­ary, while the orig­i­nal fund was launched in 2014. Both funds have en­ticed in­vest­ments from glob­al play­ers such as Danone and No­var­tis, as well as en­tre­pre­neurs and fi­nan­cial in­sti­tu­tions.

“There were in­vestors in the first fund that are re-up­ping their in­vest­ment in the sec­ond fund — ap­prox­i­mate­ly 90% are com­ing back from the first fund,” de Cre­moux said.

The con­cept of fe­cal mi­cro­bio­ta trans­plan­ta­tion (FMT) — re­plen­ish­ing a pa­tient’s gut with bac­te­ria from a healthy fe­ces — was orig­i­nal­ly doc­u­ment­ed in Chi­na, and has been used in the Unit­ed States since the 1950s with lit­tle reg­u­la­to­ry scruti­ny. About six years ago, the FDA sanc­tioned the use of FMT as a last re­sort mea­sure for re­cur­rent C. diff, but the agency con­tin­ues to con­sid­er it an in­ves­ti­ga­tion­al treat­ment. Glob­al­ly, hun­dreds of tri­als are now un­der­way test­ing the po­ten­tial of FMT for pa­tients suf­fer­ing from var­i­ous ill­ness­es, from autism to obe­si­ty.

Mi­cro­bio­me-based ther­a­peu­tics to­day is a fer­tile field for drug de­vel­op­ers tar­get­ing a wide va­ri­ety of in­di­ca­tions us­ing dif­fer­ent ther­a­peu­tic modal­i­ties, some of which are de­signed to side­step the “ick” fac­tor as­so­ci­at­ed with tra­di­tion­al stool trans­fer.

Chrono­log­i­cal­ly many of the com­pa­nies are tar­get­ing C. diff as a first in­di­ca­tion to show proof of ef­fi­ca­cy be­fore ex­pand­ing to oth­er big­ger in­di­ca­tions. Af­ter C. diff, we’ve seen a wave of com­pounds tar­get­ing IBD and Crohn’s dis­eases, meta­bol­ic dis­eases (such as obe­si­ty and di­a­betes),  au­toim­mune dis­eases and fi­nal­ly can­cer, de Cre­moux not­ed: “Can­cer is cer­tain­ly big­ger in size in terms of mar­ket po­ten­tial for mi­cro­bio­me com­pounds. More re­cent­ly it’s been about gut-brain ac­cess: not on­ly Parkin­son’s like Ax­i­al is tar­get­ing, but al­so se­vere de­pres­sion and eat­ing dis­or­ders.”

She added:

The field all start­ed with FMTs, then it moved out of FMT to fo­cus on liv­ing bio­prod­ucts, phage-de­rived com­pounds and small mol­e­cules etc. Sur­pris­ing­ly the field is mov­ing back again on FMT be­cause even if it’s very com­plex from a reg­u­la­to­ry per­spec­tive…the cur­rent clin­i­cal tri­als test­ing FMT re­al­ly show spec­tac­u­lar re­sults, and from a time­frame per­spec­tive it will prob­a­bly be the ear­li­er prod­uct to be ap­proved in the mi­cro­bio­me sec­tor, al­though some of the oth­er com­pounds men­tioned will have a high­er mar­ket po­ten­tial.

In HFL I, Sev­en­ture in­vest­ed a to­tal €160 mil­lion in 20 com­pa­nies in­clud­ing En­terome, Vedan­ta Bio­sciences, MaaT Phar­ma, and Bio­mX. HLF II is ex­pect­ed to hit its goal (of €200 mil­lion) with 20 in­vest­ments — by this sum­mer.

Pfiz­er’s Doug Gior­dano has $500M — and some ad­vice — to of­fer a cer­tain breed of 'break­through' biotech

So let’s say you’re running a cutting-edge, clinical-stage biotech, probably public, but not necessarily so, which could see some big advantages teaming up with some marquee researchers, picking up say $50 million to $75 million dollars in a non-threatening minority equity investment that could take you to the next level.

Doug Giordano might have some thoughts on how that could work out.

The SVP of business development at the pharma giant has helped forge a new fund called the Pfizer Breakthrough Growth Initiative. And he has $500 million of Pfizer’s money to put behind 7 to 10 — or so — biotech stocks that fit that general description.

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Is a pow­er­house Mer­ck team prepar­ing to leap past Roche — and leave Gilead and Bris­tol My­ers be­hind — in the race to TIG­IT dom­i­na­tion?

Roche caused quite a stir at ASCO with its first look at some positive — but not so impressive — data for their combination of Tecentriq with their anti-TIGIT drug tiragolumab. But some analysts believe that Merck is positioned to make a bid — soon — for the lead in the race to a second-wave combo immuno-oncology approach with its own ambitious early-stage program tied to a dominant Keytruda.

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UP­DAT­ED: Leg­end fetch­es $424 mil­lion, emerges as biggest win­ner yet in pan­dem­ic IPO boom as shares soar

Amid a flurry of splashy pandemic IPOs, a J&J-partnered Chinese biotech has emerged with one of the largest public raises in biotech history.

Legend Biotech, the Nanjing-based CAR-T developer, has raised $424 million on NASDAQ. The biotech had originally filed for a still-hefty $350 million, based on a range of $18-$20, but managed to fetch $23 per share, allowing them to well-eclipse the massive raises from companies like Allogene, Juno, Galapagos, though they’ll still fall a few dollars short of Moderna’s record-setting $600 million raise from 2018.

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As it hap­pened: A bid­ding war for an an­tibi­ot­ic mak­er in a mar­ket that has rav­aged its peers

In a bewildering twist to the long-suffering market for antibiotics — there has actually been a bidding war for an antibiotic company: Tetraphase.

It all started back in March, when the maker of Xerava (an FDA approved therapy for complicated intra-abdominal infections) said it had received an offer from AcelRx for an all-stock deal valued at $14.4 million.

The offer was well-timed. Xerava was approved in 2018, four years after Tetraphase posted its first batch of pivotal trial data, and sales were nowhere near where they needed to be in order for the company to keep its head above water.

RA Cap­i­tal, Hill­house join $310M rush to back Ever­est's climb to com­mer­cial heights in Chi­na

Money has never been an issue for Everest Medicines. With an essentially open tab from their founders at C-Bridge Capital, the biotech has gone two and a half years racking up drug after drug, bringing in top exec after top exec, and issuing clinical update after update.

But now other investors want in — and they’re betting big.

Everest is closing its Series C at $310 million. The first $50 million comes from the Jiashan National Economic and Technological Development Zone; the remaining C-2 tranche was led by Janchor Partners, with RA Capital Management and Hillhouse Capital as co-leaders. Decheng Capital, GT Fund, Janus Henderson Investors, Rock Springs Capital, Octagon Investments all joined.

Por­tion of Neil Wood­ford’s re­main­ing in­vest­ments, in­clud­ing Nanopore, sold off for $284 mil­lion

It’s been precisely one year and one day since Neil Woodford froze his once-vaunted fund, and while a global pandemic has recently shielded him from the torrent of headlines, the fallout continues.

Today, the California-based patent licensing firm Acacia Research acquired the fund’s shares for 19 healthcare and biotech companies for $284 million.  Those companies include shares for public and private companies and count some of Woodford’s most prominent bio-bets, such as Theravance Biopharma, Oxford Nanopore and Mereo Biopharma, according to Sky News, which first reported the sale. It won’t include shares for BenevelontAI, the machine learning biotech once valued at $2 billion.

Drug man­u­fac­tur­ing gi­ant Lon­za taps Roche/phar­ma ‘rein­ven­tion’ vet as its new CEO

Lonza chairman Albert Baehny took his time headhunting a new CEO for the company, making it absolutely clear he wanted a Big Pharma or biotech CEO with a good long track record in the business for the top spot. In the end, he went with the gold standard, turning to Roche’s ranks to recruit Pierre-Alain Ruffieux for the job.

Ruffieux, a member of the pharma leadership team at Roche, spent close to 5 years at the company. But like a small army of manufacturing execs, he gained much of his experience at the other Big Pharma in Basel, remaining at Novartis for 12 years before expanding his horizons.

Covid-19 roundup: Ab­b­Vie jumps in­to Covid-19 an­ti­body hunt; As­traZeneca shoots for 2B dos­es of Ox­ford vac­cine — with $750M from CEPI, Gavi

Another Big Pharma is entering the Covid-19 antibody hunt.

AbbVie has announced a collaboration with the Netherlands’ Utrecht University and Erasmus Medical Center and the Chinese-Dutch biotech Harbour Biomed to develop a neutralizing antibody that can treat Covid-19. The antibody, called 47D11, was discovered by AbbVie’s three partners, and AbbVie will support early preclinical work, while preparing for later preclinical and clinical development. Researchers described the antibody in Nature Communications last month.

Michael Gladstone, partner at Atlas Venture

At­las rais­es new $400M fund amid spree of VC rais­es. Here’s what they’ll spend it on

You can add another few hundred million to the now Montana-sized reservoir of cash biotech VCs have raised since the WHO declared Covid-19 a pandemic.

Atlas Venture, the prominent Kendall Square incubator, has raised $400 million for its twelfth biotech fund, their first in 3 years. After a string of mammoth new raises from other major VCs in April and May, the total pot now stands between $5 billion and $6 billion, depending on how you slice it.

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