Sujal Patel (L) and Parag Mallick

Nau­tilus set to go pub­lic in re­verse merg­er with Per­cep­tive SPAC, aims to test pro­teomics plat­form with big-name back­ers

With the back­ing of Paul Allen and Jeff Be­zos, among oth­ers, Nau­tilus Biotech­nol­o­gy is set­ting sail for Nas­daq, ink­ing a deal with one of Per­cep­tive’s blank-check com­pa­nies to un­lock the mys­ter­ies of the hu­man pro­teome.

The Seat­tle-based biotech will re­verse merge with Arya Sci­ences Ac­qui­si­tion Corp III, which pen­ciled in a $143.7 mil­lion IPO raise back in late-Ju­ly, Nau­tilus said Mon­day. In Au­gust, the SPAC priced 13,000,000 shares at $10 apiece.

The com­bined com­pa­ny is ex­pect­ed to re­ceive about $350 mil­lion up­on clos­ing the merg­er — $150 mil­lion from Arya III’s trust ac­count, plus a com­mon stock PIPE of about $200 mil­lion led by Per­cep­tive. Nau­tilus and Arya are hop­ing to seal the deal in Q2, and pegged their ini­tial mar­ket cap at $1.3 bil­lion.

The pro­ceeds will be used to ad­vance Nau­tilus’ pro­tein analy­sis plat­form, which came to co-founder Parag Mallick one week­end morn­ing in an apart­ment out­side Stan­ford Uni­ver­si­ty. Mallick spent that week­end as “kind of a crazy per­son,” do­ing sim­u­la­tions to fig­ure out a way to do pro­teomics dif­fer­ent­ly, he told End­points in May. Then he ex­plained the idea to Su­jal Pa­tel, who cut him a check that night.

Pa­tel and Mallick found­ed Nau­tilus in 2016, and at­tract­ed big-name in­vestors like Paul Allen’s Vul­can Cap­i­tal and Be­zos Ex­pe­di­tions. No­bel Prize win­ner Lee Hartwell, who was once pres­i­dent of the Fred Hutchin­son Can­cer Re­search Cen­ter, is lend­ing his ex­per­tise on the sci­en­tif­ic ad­vi­so­ry board. The goal is to scale up the emerg­ing field of pro­teomics as Il­lu­mi­na scaled up ge­nomics, Pa­tel and Mallick, who are now CEO and chief sci­en­tist re­spec­tive­ly, told End­points. And in May, they nabbed a $76 mil­lion Se­ries B to do so.

“This mis­sion is guid­ed by a recog­ni­tion that ma­jor ad­vances in pro­teomics have lagged be­hind ge­nomics, which Nau­tilus Biotech­nol­o­gy be­lieves is pri­mar­i­ly due to a lack of avail­able tools for mea­sur­ing the pro­teome as eas­i­ly or com­plete­ly as one can mea­sure the genome and tran­scrip­tome,” Nau­tilus said in a state­ment on Mon­day.

Pro­teomics — the study of all the pro­teins in an or­gan­ism — has proven quite the chal­lenge. Sci­en­tists say slow progress is due to the fact that it’s much more dif­fi­cult to de­tect pro­teins than it is to de­tect ge­net­ic ma­te­r­i­al. Pro­teins are more com­plex and di­verse, and they can’t be ar­ti­fi­cial­ly am­pli­fied to make them more read­able.

Nau­tilus says its plat­form is com­pre­hen­sive, and can de­tect minute quan­ti­ties of pro­tein.

“We be­lieve Nau­tilus has the po­ten­tial to help rev­o­lu­tion­ize bio­med­i­cine with an ul­tra-sen­si­tive, sin­gle-mol­e­cule pro­tein analy­sis plat­form de­signed to com­pre­hen­sive­ly an­a­lyze and quan­ti­fy the hu­man pro­teome,” Pa­tel said.

Arya III is the third in a se­ries from Per­cep­tive. Arya I merged with biotech Im­mat­ics in a $252 mil­lion deal in March. Cerev­el Ther­a­peu­tics merged with Arya II in Ju­ly, ex­pect­ing to raise about $445 mil­lion to de­vel­op its pipeline.

Un­pack­ing the Aduhelm de­ci­sion, Ver­tex's half full glass, a $525M J&J breakup, and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

By now you have surely read about the FDA’s controversial approval of Biogen’s Alzheimer’s drug and all its reverberations. But I’d still recommend checking out the meaty recap below to make sure you didn’t miss all the angles that the Endpoints team has covered. If you’d rather look ahead, look no further than our three-day virtual panels next week at BIO, where we will discuss what the new normal means for every part of the industry.

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What does a clear ma­jor­i­ty of the bio­phar­ma in­dus­try think of the FDA ap­proval of ad­u­canum­ab? 'Hor­ri­fy­ing' 'Dan­ger­ous' 'Con­fus­ing' 'Dis­as­ter'

Over the years, we’ve become used to seeing a consensus emerge early in our industry polls at Endpoints News. And when we took the pulse of drug hunters on the heels of a controversial FDA approval for aducanumab this week, it became immediately apparent that the vast majority of our readers — heavily concentrated among biopharma staffers and execs — were incensed by what they had just witnessed.

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Aaron Kesselheim (Scott Eisen/AP Images for AIDS Healthcare Foundation)

Har­vard’s Aaron Kessel­heim re­signs from ex­pert pan­el in wake of ad­u­canum­ab OK, blast­ing FDA for ‘worst drug ap­proval de­ci­sion in re­cent U.S. his­to­ry'

A third member of the FDA’s Peripheral and Central Nervous System Drugs Advisory Committee has resigned in the wake of Biogen’s controversial Aduhelm approval, slamming the agency as he left and further deepening the controversy surrounding the decision.

Harvard University professor Aaron Kesselheim quit in protest Thursday afternoon, calling the Aduhelm OK “probably the worst drug approval decision in recent U.S. history.” Kesselheim follows both Joel Perlmutter, a neurologist from Washington University in St. Louis, and David Knopman, a neurologist from the Mayo Clinic, out the door.

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David Knopman (Mayo Clinic via YouTube)

A sec­ond ad­comm mem­ber aban­dons his post in af­ter­math of con­tro­ver­sial ad­u­canum­ab de­ci­sion

As the fallout from the FDA’s approval of Alzheimer’s med aducanumab grows, a second member of the adcomm overseeing that drug’s review has walked away. But even with two experts now having resigned from that committee in protest, is there enough broad-level outrage to prevent another aducanumab from getting approved?

The FDA on Wednesday lost another member of its Peripheral and Central Nervous System Drugs Advisory Committee as Mayo Clinic neurologist David Knopman hit the exit over the agency’s decision to approve Biogen’s Alzheimer’s drug Aduhelm despite the committee’s near-unanimous vote against it.

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FDA au­tho­rizes about 10M J&J vac­cine dos­es, trash­es 60M more from trou­bled Emer­gent plant

The FDA on Friday released about 10 million doses of J&J’s vaccine for use, and disposed of another 60 million doses that were manufactured at the now-shuttered Emergent BioSolutions facility in Baltimore where cross-contamination occurred.

The agency said it’s not yet ready to allow the Emergent plant to be included in the J&J EUA, but that may occur soon. FDA came to the decision to authorize some of the doses after reviewing facility records and quality testing results.

The IPO 4-1-1: Four fil­ings, a pric­ing and a with­draw­al head­line this week's Nas­daq ac­tion as raise ap­proach­es $7.5B

Editor’s note: Interested in following biopharma’s fast-paced IPO market? You can bookmark our IPO Tracker here.

Another week, another horde of biotechs is doing the Nasdaq dance.

This week saw four companies file their SEC paperwork ahead of expected debuts, another hit Nasdaq on Friday and a sixth formally withdrew its bid to go public. Aerovate Therapeutics, Ocean Biomedical and Acumen Pharmaceuticals all penciled in initial raises of $100 million, while Dermata Therapeutics is estimating a modest $18 million raise.

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Keiichi Fukuda, Heartseed CEO

Fresh off $598M deal with No­vo Nordisk, a Japan­ese stem cell com­pa­ny is on its way to the clin­ic with a dif­fer­ent ap­proach to treat­ing heart fail­ure

A common approach to treating heart failure with induced pluripotent stem cells involves grafting sheets of cells onto the surface of the heart to improve vascularization and blood flow. It’s the easiest method of transplantation — but you run the risk of not making an electrical connection with the heart and the cells not synchronizing with the patient’s heart muscle.

So what if you could inject spherical clusters of heart cells directly into the heart muscle wall? For Heartseed, that’s now the $37 million question.

Janet Woodcock, acting FDA commissioner, at Thursday's Senate Appropriations hearing (Bill Clark/CQ Roll Call via AP Images)

Sen­a­tors lam­bast new Alzheimer’s drug’s price but give Janet Wood­cock a free pass on the ap­proval de­ci­sion

Senate Finance Democrats took aim at Biogen’s pricey new Alzheimer’s drug on Thursday, but members on both sides of the aisle at a separate appropriations hearing didn’t question acting FDA commissioner Janet Woodcock on the approval.

“I was appalled that Biogen priced their Alzheimer’s drug approved by the FDA at $56,000 per year — I’m not going to debate whether this is effective or not, but it’s double the household median income for Michiganders over the age of 65,” Sen. Debbie Stabenow (D-MI) said at the finance hearing.

Reshma Kewalramani, Vertex CEO (BIO via YouTube)

UP­DAT­ED: Ver­tex strikes out on its lat­est big shot at a rare ge­net­ic dis­ease. But they're go­ing to keep on swing­ing

It’s been several months since Vertex culled one of its small molecules for alpha-1 antitrypsin deficiency (AATD), taking a big hit after evidence of liver damage surfaced in a key Phase II trial. Now we learned that the company has whiffed on its second shot, and there’s nothing left in the clinic to treat the rare genetic disease — but that won’t stop it from trying.

Despite avoiding the safety issues that plagued the last candidate, Vertex $VRTX is taking the axe to VX-864 after Phase II results revealed the magnitude of the drug’s response is “unlikely to translate into substantial clinical benefit.” As a result of the news, the company’s stock fell 12.5% after hours.

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