Novo-backed Galecto Biotech scores €79 million in Series C funding
Galecto Biotech has closed a €79 million Series C funding round that will help advance the development of its lead galectin-3 inhibitor for idiopathic pulmonary fibrosis (IPF).
The Copenhagen-based company, which is developing so-called galectin modulators for a plethora of diseases including fibrosis and cancer, is the brainchild of two scientists from the University of Lund in Sweden. The company, led by founder and CEO Hans Schambye, was originally funded via the pre-seed grant program of the Novo Nordisk $NVO Foundation in 2010. Eventually, the early-stage investment arm of Novo Nordisk Foundation owned Novo Holdings — Novo Seeds — led the first seed investment round in 2011.
As part of this Series C funding round, Novo Seeds has invested €12.5 million, including a convertible loan, making it Galecto’s largest shareholder. In addition, the round of financing was co-led by Ysios Capital and OrbiMed, and included existing investors M Ventures and Sunstone Capital. New investors into the company included Bristol Myers-Squibb $BMY, HBM Healthcare Investments, Maverick Ventures and Seventure Partners.
The financing will also enable the clinical investigation of two additional galectin modulators designed to treat fibrotic diseases of other organs, such as the liver and eye, Galecto said. Galectin-3 is a protein which binds to carbohydrate structures, and plays a central role in fibrosis. By inhibiting the protein’s binding ability, this class of drugs aim to treat diseases that exhibit galentin-3 expression such as IPF, a chronic, progressive lung disease characterized by the scarring of lung tissue.
If the Phase II/III study is successful, this data could potentially be used for a marketing filing, Schambye told Endpoints News, noting that the company’s model includes plans to accommodate an additional late-stage study if necessary. Galecto is not disclosing its valuation at the moment, he said, adding that the company is not averse to partnerships, M&A or an IPO in the future although it is equipped to take TD139 across the finish line on its own.
In 2014, Bristol-Myers signed an option to license Galecto’s IPF drug TD139 following the results of its Phase Ib/IIa data, but did not exercise that option.