SoftBank leads $150M round into Dewpoint as condensate biotech nears clinic
In another market, Dewpoint Therapeutics may have gone public about now and raised a princely sum.
Although they’re still around two years from human trials, the biotech already has blue-chip VC backers, three Big Pharma partnerships, and a compelling story about being the first and biggest entrant to a new field of biology. But Wall Street isn’t buying much of anything these days.
So Dewpoint will have to settle for the next best thing: a venture capital firm that often acts as if it has as much money as Wall Street — SoftBank.
The tech-focused mega-VC led a $150 million Series C for Dewpoint, the company announced Thursday. Those funds will be enough to carry Dewpoint into the clinic at the end of 2023, while advancing of suite of 19 other programs as the company tries to fashion itself into one of the next major biotechs, in the vein of Alnylam.
“The playbook is look, we’ve got new biology,” CEO Ameet Nathwani said. “Let’s go as broad as we can and let’s go as fast as we can.”
Dewpoint, of course, is still far from achieving that. Their central focus — what’s known as biomolecular condensates — were discovered barely a decade ago, although they’re already implicated in a host of cell processes, from cell signaling to gene expression, and a host of diseases, from ALS to infections like RSV.
Condensates are essentially compartments a cell can form to perform a given function. In the nucleus, for example, cells can use them to both bring transcription machinery together to make new proteins faster, and block off genes from being transcribed altogether.
They’re formed by liquid-liquid phase separation, the same physics that keeps oil droplets suspended in water. (Exactly how the cell forms these droplets is still a matter of debate. Quanta does a good job explaining the competing theories.)
Nathwani’s competition also now faces competition. Dewpoint, co-founded by Anthony Hyman, the principal investigator who first wrote about condensates, was the first major company to explore their potential in therapeutics. But they are no longer alone. Hyman’s postdoc student, Clifford Brangwynne, now a professor at Princeton, founded his own condensate-focused company in November 2020 called Nereid. Third Rock followed up a month later with Faze Medicines.
Nathwani said the company differentiates itself with its breadth: It has internal programs in neuroscience and oncology, and is teaming with Merck in HIV and with Bayer in women’s health and cardiovascular disease. They’re trying, in other words, to tackle nearly every application of condensate biology.
Dewpoint also boasts that it’s built machine learning technology to match genetic mutations to changes to condensates in the cell, along with a screening platform for new molecules that can interfere with them.
“It’s going to be a novel genetics approach, it’s going to be a novel computer vision approach,” he said. “The biology platform is extremely broad.”
It’s the kind of tech-first talk that can attract investors like SoftBank. The firm has not always been as the most discerning VC, famously giving WeWork $4.4 billion after a 12-minute tour and handing a dog-walking app $300 million. (A former SoftBank executive once remarked of Masayoshi Son, the founder: “Masa is not a particularly deep thinker, but he has one strength: he’s devoted to buying more lottery tickets than anyone else.”)
But in the last couple years, SoftBank’s latest fund, led by Vikas Parekh, has waded into biotech, mostly in places tech VCs often do: a company using AI to screen molecules, another promising to use machine learning to engineer better gene therapies, Brendan Frey’s RNA-focused AI startup.
The same thing drew them to Dewpoint, Nathwani said.
“It’s the digital aspect combined with the biology,” he said.
And yet Faze and Nereid have promised to bring similar levels of digital sophistication to interrogate condensates and design new medicines, the latter relying in part on approaches Brangwynne has developed over the years in his lab.
None have yet delivered data. They’ll likely be competing for years, each hoping that new biology doesn’t bring too much of what it always brings: new surprises.