How much does it cost to bootstrap a gene therapy startup? Not too much if you're Jim Wilson, per Passage Bio's $125M IPO filing
Days ago when Deerfield partner Bruce Goldsmith jumped to helm Passage Bio, he cited a few reasons why it’s an “extremely exciting time” to be joining the gene therapy player: IND filings for three lead programs, a data-rich 2021 and an expanding pipeline of experimental drugs for rare, monogenic CNS diseases.
It turns out there’s one more reason he held back: The Philadelphia-based startup was prepping an IPO.
Passage Bio has penciled in $125 million for its public debut on the Nasdaq, with the majority of the proceeds going to the three AAV-based product candidates slated to enter the clinic in 2020.
Here’s the breakdown on the tech behind each of them — offering a glimpse of the arsenal of delivery tools co-founder Jim Wilson has assembled over the decades:
- PBGM01 utilizes a next-generation AAVhu68 capsid to deliver to the brain and peripheral tissues a functional GLB1 gene encoding lysosomal beta-galactosidase, or b-gal, for infantile GM1 gangliosidosis
- PBFT02 utilizes an AAV1 capsid to deliver to the brain a functional GRN gene encoding progranulin, or PGRN, for FTD caused by progranulin deficiency, or FTD-GRN
- PBKR03 utilizes a next-generation AAVhu68 capsid to deliver to the brain and peripheral tissues a functional gene encoding the hydrolytic enzyme galactosylceramidase, or GALC, for infantile Krabbe disease
There are some competitors working on each of the diseases they are tackling, including Axovant and Lysogene for GM1 as well as Alector and Prevail for FTD, but Passage Bio was confident about being an integrated player capable of tackling multiple “cross-correctional therapies” in the CNS.
Wilson, a well-respected pioneer in the gene therapy field, had intended for this to be his legacy company, OrbiMed partner Stephen Squinto previously told Endpoints News. Thanks to Wilson’s connection at the University of Pennsylvania, Passage secured a licensing deal with the university for an upfront of just $2.5 million in cash and 3,720,000 shares in stock (then valued at $0.9 million) — plus a promise to fund certain preclinical activities, the S-1 revealed.
The pact covered rights to 12 therapies in total, and should Passage exercise those options by the 2022 expiry date, upfront fees would be somewhere between $0.8 million to $1 million. They have already made the call on six; Penn is eligible for up to $16.5 million in development milestones and $55 million in sales milestones for each.
That, plus the $10 million upfront Passage paid Catalent’s Paragon subsidiary for manufacturing work, amounted to the bulk of the biotech’s expense. While it’s bagged two hefty megarounds, Passage has only burned through $58.7 million so far.
The syndicate stayed basically the same throughout Series A and B, featuring Frazier Life Sciences (13.9%, represented by Wilson’s longtime mentor Tachi Yamada on the board), OrbiMed (19.6%), Versant Ventures (14.8%) Lilly Asia Ventures (7.6%), New Leaf Ventures (7.0%), Vivo Capital (7.0%) and Access Industries’ AI Passage (6.5%). Wilson retained 7.0% for himself.
With his rare disease experience gleaned from years at Alexion, Squinto initially took up the CEO role before passing the reins to Goldsmith. His compensation package for the past year totaled $2.2 million compensation, and he continues to be part of the team as interim head of R&D.
Chief technical officer Alex Fotopoulos and chief medical officer Gary Romano received $2.25 million and $2.02 million, respectively.