Quest for safe mus­carinic re­cep­tor ag­o­nists to tack­le dis­as­ter prone CNS field steers Karuna to $75M IPO

Less than a year af­ter rais­ing $42 mil­lion, bank­ing on the po­ten­tial of two old­er drugs as an ap­proach to fight Alzheimer’s and schiz­o­phre­nia, Boston-based Karuna Phar­ma­ceu­ti­cals on Fri­day laid the ground­work for a $75 mil­lion IPO.

The PureTech-backed com­pa­ny is work­ing on the hy­poth­e­sis that a com­bi­na­tion of mus­carinic acetyl­choline re­cep­tor ag­o­nist xanome­line — an Eli Lil­ly castoff — and tro­spi­um chlo­ride, an FDA-ap­proved mus­carinic re­cep­tor an­tag­o­nist to­geth­er will make an adept an­tipsy­chot­ic.

Steven Paul Linkedin

Once up­on a time when star CNS re­searcher (and for­mer Voy­ager chief) Steven Paul was at Lil­ly, where he worked on xanome­line. The drug is de­signed to tar­get M1 and M4 re­cep­tors in the brain — but ad­verse events trig­gered by off-tar­get ef­fects soured the US drug­mak­er on the drug. Last Au­gust, he was one of the syn­di­cates of in­vestors in­clud­ing ARCH Ven­ture Part­ners and the Well­come Trust that backed Karuna.

Ex­ist­ing an­tipsy­chot­ic treat­ments work pri­mar­i­ly by in­hibit­ing D2 dopamine re­cep­tors. Mus­carinic re­cep­tor ag­o­nists emerged in the 1990s as a po­ten­tial al­ter­na­tive ap­proach for treat­ing psy­chosis —  but the de­vel­op­ment of such ther­a­peu­tics has been lim­it­ed by un­de­sir­able side-ef­fects that are trig­gered by the stim­u­la­tion of mus­carinic re­cep­tors in pe­riph­er­al tis­sues.

An­drew Miller Linkedin

The big idea at Karuna is that the ad­di­tion of tro­spi­um chlo­ride will counter the ad­verse event pro­file of xanome­line — the com­bined prod­uct has been dubbed KarXT. It is de­signed to make a bee­line for mus­carinic re­cep­tors in the cen­tral ner­vous sys­tem and to ig­nore pe­riph­er­al tis­sues. The lead ex­per­i­men­tal treat­ment is be­ing test­ed as a treat­ment for psy­chosis in a mid-stage study with schiz­o­phre­nia pa­tients — da­ta is ex­pect­ed by the end of the year. It is al­so in ear­ly-stage pro­grams for oth­er schiz­o­phre­nia symp­toms, Alzheimer’s-re­lat­ed psy­chosis and pain.

Oth­er drug­mak­ers have al­so been se­duced by the po­ten­tial of mus­carinic re­cep­tors. For in­stance, Al­ler­gan inked a $3.3 bil­lion deal to in-li­cense M1 and M4 tar­get­ed drugs from Hep­tares in the spring of 2016.

Karuna, which is run by MIT grad­u­ate An­drew Miller, is aim­ing to make its pub­lic de­but us­ing the sym­bol “$KRTX,” it said in a fil­ing.


Im­age: Shut­ter­stock

UP­DAT­ED: In sur­prise switch, Bris­tol-My­ers is sell­ing off block­buster Ote­zla, promis­ing to com­plete Cel­gene ac­qui­si­tion — just lat­er

Apart from revealing its checkpoint inhibitor Opdivo blew a big liver cancer study on Monday, Bristol-Myers Squibb said its plans to swallow Celgene will require the sale of blockbuster psoriasis treatment Otezla to keep the Federal Trade Commission (FTC) at bay.

The announcement — which has potentially delayed the completion of the takeover to early 2020 — irked investors, triggering the New York-based drugmaker’s shares to tumble Monday morning in premarket trading.

Celgene’s Otezla, approved in 2014 for psoriasis and psoriatic arthritis, is a rising star. It generated global sales of $1.6 billion last year, up from the nearly $1.3 billion in 2017. Apart from the partial overlap of Bristol-Myers injectable Orencia, the company’s rival oral TYK2 psoriasis drug is in late-stage development, after the firm posted encouraging mid-stage data on the drug, BMS-986165, last fall. With Monday’s decision, it appears Bristol-Myers is favoring its experimental drug, and discounting Otezla’s future.

The move blindsided some analysts. Credit Suisse’s Vamil Divan noted just days ago:

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Novotech CEO Dr. John Moller

Novotech CRO Award­ed Frost & Sul­li­van Best Biotech CRO Asia-Pa­cif­ic 2019

Known in the in­dus­try as the Asia-Pa­cif­ic CRO, Novotech is now lead CRO ser­vices provider for the grow­ing num­ber of in­ter­na­tion­al biotechs se­lect­ing the re­gion for their stud­ies.

Re­flect­ing this Asia-Pa­cif­ic growth, Novotech staff num­bers are up 20% since De­cem­ber 2018 to 600 in-house clin­i­cal re­search peo­ple across a full range of ser­vices, across the re­gion.

Novotech’s ca­pa­bil­i­ties have been rec­og­nized by an­a­lysts like Frost & Sul­li­van, most re­cent­ly with the pres­ti­gious Asia-Pa­cif­ic CRO Biotech of the year award for best prac­tices in clin­i­cal re­search for biotechs for the fifth year. See oth­er awards here.

Mike Grey. Mirum

In $86M IPO pitch, Mirum spells out plans to turn Shire dis­cards in­to or­phan liv­er drug suc­cess­es

Mike Grey doesn’t have any time to waste. Hav­ing re­gained con­trol of two liv­er dis­ease drugs from Shire and po­si­tioned them for piv­otal stud­ies — five years af­ter first hand­ing them off in a deal to sell Lu­me­na, where he was CEO — Grey is steer­ing Mirum straight in­to an IPO with a $86 mil­lion ask.

Not that Mirum has spent much of its $120 mil­lion Se­ries A cash since launch­ing last No­vem­ber. Ac­cord­ing to the S-1, the Cal­i­forn­ian biotech has burned through $23.3 mil­lion as of March, but ex­pects ex­pens­es to pick up once their clin­i­cal work gath­ers steam.

Dean Hum. Nasdaq via YouTube

Gen­fit goes to Chi­na with a deal worth up to $228M for NASH drug

Fresh off the high of its Nas­daq IPO de­but, and the low of com­par­isons to Cymabay — whose NASH drug re­cent­ly stum­bled — Gen­fit on Mon­day un­veiled an up to $228 mil­lion deal with transpa­cif­ic biotech Terns Phar­ma­ceu­ti­cals to de­vel­op its flag­ship ex­per­i­men­tal liv­er drug — elafi­bra­nor — in Greater Chi­na.

The deal comes weeks af­ter Gen­fit $GN­FT is­sued a fiery de­fense of its dual PPAR ag­o­nist elafi­bra­nor, when com­peti­tor Cymabay’s PPARδ ag­o­nist, se­ladel­par, fiz­zled in a snap­shot of da­ta from an on­go­ing mid-stage tri­al. The main goal at the end of 12 weeks was for se­ladel­par to in­duce a sta­tis­ti­cal­ly sig­nif­i­cant im­prove­ment in liv­er fat con­tent, but da­ta showed that pa­tients on the place­bo ac­tu­al­ly per­formed bet­ter.

Gene ther­a­py biotech sees its stock rock­et high­er on promis­ing re­sults for rare cas­es of but­ter­fly dis­ease

Shares of Krys­tal Biotech took off this morn­ing $KRYS af­ter the lit­tle biotech re­port­ed promis­ing re­sults from its gene ther­a­py to treat a rare skin dis­ease called epi­der­mol­y­sis bul­losa.

Fo­cus­ing on an up­date with 4 new pa­tients, re­searchers spot­light­ed the suc­cess of KB103 in clos­ing some stub­born wounds. Krys­tal says that of 4 re­cur­ring and 2 chron­ic skin wounds treat­ed with the gene ther­a­py, the KB103 group saw the clo­sure of 5. The 6th — a chron­ic wound, de­fined as a wound that had re­mained open for more than 12 weeks — was par­tial­ly closed. That brings the to­tal so far to 8 treat­ed wounds, with 7 clo­sures.

Bris­tol-My­ers star Op­di­vo fails sur­vival test in a matchup with Nex­avar aimed at shak­ing up the big HCC mar­ket

Bris­tol-My­ers Squibb has suf­fered an­oth­er painful set­back in its years-long quest to ex­pand the reach of Op­di­vo. The phar­ma gi­ant this morn­ing not­ed that their Check­mate-459 study com­par­ing Op­di­vo with Bay­er’s Nex­avar in front­line cas­es of he­pa­to­cel­lu­lar car­ci­no­ma — the most com­mon form of liv­er can­cer — failed to hit the pri­ma­ry end­point on over­all sur­vival.

This was a sig­nif­i­cant mile­stone in Bris­tol-My­ers’ tal­ly of PD-1 cat­a­lysts this year. Nex­avar (so­rafenib) has been the stan­dard of care in front­line HCC for the past decade, though Op­di­vo has been mak­ing head­way in sec­ond-line HCC cas­es, where it’s go­ing toe-to-toe with Bay­er’s Sti­var­ga (re­go­rafenib) af­ter re­cent ap­provals shook up the mar­ket.

Fol­low­ing news of job cuts in Eu­ro­pean R&D ops, Sanofi con­firms it’s of­fer­ing US work­ers an 'ear­ly ex­it'

Ear­li­er in the week we learned that Sanofi was bring­ing out the bud­get ax to trim 466 R&D jobs in Eu­rope, re­tool­ing its ap­proach to car­dio as re­search chief John Reed beefed up their work in can­cer and gene ther­a­pies. And we’re end­ing the week with news that the phar­ma gi­ant has al­so been qui­et­ly re­duc­ing staff in the US, tar­get­ing hun­dreds of jobs as the com­pa­ny push­es vol­un­tary buy­outs with a fo­cus on R&D sup­port ser­vices.

Suf­fer­ing No­var­tis part­ner Cona­tus is pack­ing it in on NASH af­ter a se­ries of un­for­tu­nate tri­al events

The NASH par­ty is over at No­var­tis-backed Cona­tus. And this time they’re turn­ing off the lights.

More than 2 years af­ter No­var­tis sur­prised the biotech in­vest­ment com­mu­ni­ty with its $50 mil­lion up­front and promise of R&D sup­port to part­ner with the lit­tle biotech on NASH — ig­nit­ing a light­ning strike for the share price — Cona­tus $CNAT is back with the lat­est bit­ter tale to tell about em­ri­c­as­an, which once in­spired con­fi­dence at the phar­ma gi­ant.

Alex­ion wins pri­or­i­ty re­view for Ul­tomiris' aHUS in­di­ca­tion; FDA ex­pands ap­proval of Ver­tex's Symdeko

→ Alex­ion $ALXN has scored a speedy re­view for Ul­tomiris for pa­tients with atyp­i­cal he­molyt­ic ure­mic syn­drome (aHUS) af­ter post­ing pos­i­tive da­ta from a piv­otal study in Jan­u­ary. The drug is the rare dis­ease com­pa­ny’s shot at pro­tect­ing its block­buster blood dis­or­der fran­chise that is cur­rent­ly cen­tered around its flag­ship drug, Soliris, which is a com­ple­ment in­hibitor typ­i­cal­ly ad­min­is­tered every two weeks. Ul­tomiris has a sim­i­lar mech­a­nism of ac­tion but re­quires less-fre­quent dos­ing — every eight weeks. The de­ci­sion date has been set to Oc­to­ber 19. Late last year, Ul­tomiris se­cured ap­proval for noc­tur­nal he­mo­glo­bin­uria (PNH) pa­tients.