Seeking to 'close the loop' in drug discovery with machine learning, Catalio-backed biotech emerges from semi-stealth
Two years after securing seed funding and remaining in a state of “semi-stealth,” a San Francisco biotech keen on combining evolution and small molecule discovery recently bagged a VC round that will let it do just that.
Known as Anagenex, the company announced Wednesday that it raised a $30 million Series A round, securing the attention of Catalio Capital Management as lead investor. A few other investors tagged along, such as Lux Capital and Khosla Ventures.
Lux Capital had led Anagenex’s seed round back in 2020, which netted the biotech $7.2 million. According to Anagenex CEO Nicolas Tilmans, the round should last the biotech at least two years.
Anagenex said in a statement that it plans to use its Series A funds to “further expand its novel data generating platform and build a robust pipeline of programs addressing historically challenging unmet medical needs.”
Tilmans started off by telling Endpoints News that in his mind, the force of evolution is one of the strongest forces in nature.
“And if you can create a system that harnesses evolution, you will almost always do better in biology than otherwise,” added the CEO, who has a PhD in biochemistry out of Stanford.
The biotech got off the ground in 2018, after Tilmans said he saw this evolutionary concept in both antibody and protein-based drug discovery. So he wondered, why not apply this in small molecules? From his perspective, the impediment had been a lack of ways to “close the loop.”
The CEO compared it to subjecting finches to evolutionary pressures and seeing which finches make it through. As they repopulate over time, one could create the perfect finch — a similar theory posited by Charles Darwin with his finches.
According to Anagenex, the platform now gives way to a closed loop that can be refined again and again, making for a directed evolution process, in Tilmans’ words.
After taking an initial library of potential compounds (anywhere from a couple hundred million to more than a billion) and screening them to see if they bind to a certain target, results are fed into the biotech’s machine learning platform. Then, that platform creates a narrowed library of 1 million of more “promising” compounds based on the results of the previous screen. The refined compound library gets screened again as results are re-fed into the machine learning platform, and it spits out another narrow compound library to be further refined.
The company will begin with synthetic lethal oncology, with Anagenex also taking a look at certain inflammation and cardiovascular targets. So far, there are three programs in play: two in synthetic lethal oncology and one in cardiovascular.
Tilmans said he can see small molecules branch out into multiple indications akin to Keytruda or Humira, which are both antibodies — and that is their goal.
“We don’t have the luxury of Pfizer. So yes, anything we pick, we’d like to be able to have it go into multiple different indications. But the most important thing for us is to take a problem that we’re pretty sure we’re gonna win. And we’re pretty sure that the market at the other end is going to be big enough,” the CEO added.
In terms of partnerships, Tilmans said that there are a few ongoing conversations, but he claims his approach to partnerships is markedly different from other biotech CEOs.
I want to emphasize that we are a therapeutics company, and we want to be solving problems and then bringing the fruits of our labor to the patient, ourselves. So that’s a little bit different than some of the other companies in the space. One of the ways I like to think about it is sort of like Wall Street newsletters. If you’re telling me what things to invest in, maybe you should invest in them, and put your money where your mouth is. And that’s the way we see drug discovery.
Anagenex currently has about 18 employees, and plans to reach 30 within the next 18 months or so.
In the meantime, Anagenex’s board gets two new members as part of the raise: Catalio co-founder and partner George Petrocheilos as a director and Catalio analyst Matthew Hobson as an observer.