If Stew­art Camp­bell had said five years ago that you could treat con­di­tions of the brain through the gut, you prob­a­bly would have thought he was crazy — or at least that’s what he likes to say.

Since then, a crop of biotechs ex­plor­ing the gut-brain ax­is has got­ten the at­ten­tion of some well-known in­vestors. Camp­bell’s Ax­i­al Ther­a­peu­tics is now the lat­est, un­veil­ing a $37.25 mil­lion Se­ries C round on Wednes­day morn­ing that brings the com­pa­ny’s to­tal raise to just over $90 mil­lion.

The ex­tra cash will be used to con­duct a Phase II tri­al of the com­pa­ny’s lead pro­gram, a gut-re­strict­ed mol­e­c­u­lar ther­a­py for ir­ri­tabil­i­ty in chil­dren with autism called AB-2004.

David Don­abe­di­an

Ax­i­al’s sci­ence traces back to a plat­form that pro­fes­sor Sarkis Maz­man­ian had brew­ing in his lab sev­er­al years ago at Cal­tech. His team pub­lished re­search from an­i­mal stud­ies that es­tab­lished a link be­tween the pop­u­la­tion of tiny mi­crobes in your body and the course of autism spec­trum dis­or­ders. In 2016, he and the Long­wood Fund’s David Don­abe­di­an spun that re­search in­to a com­pa­ny, which Don­abe­di­an ran un­til hand­ing the reins to Camp­bell ear­li­er this year.

AB-2004’s mech­a­nism of ac­tion be­gins with mi­crobes in the gut that di­gest pro­tein down to their com­po­nent amino acids, which are fur­ther di­gest­ed in­to some­thing called small mol­e­cule metabo­lites. A cer­tain class of these metabo­lites are then ab­sorbed by the blood and can trav­el to the brain, Camp­bell ex­plained. There, sci­en­tists have shown that the metabo­lites can al­ter the de­vel­op­ment of cer­tain brain cells — in par­tic­u­lar, cells that pro­duce myelin.

If you think of an elec­tri­cal wire, there’s usu­al­ly a plas­tic coat­ing to in­su­late the wire and keep it from short-cir­cuit­ing, Camp­bell said. That’s what myelin is for neu­rons. When cells that pro­duce myelin are pre­vent­ed from ma­tur­ing prop­er­ly, Ax­i­al be­lieves be­hav­ior is af­fect­ed, like dan­ger sens­ing or fear con­di­tion­ing.

“That’s the way we con­nect all those dots from the gut mi­crobes all the way to be­hav­ior,” he said.

AB-2004 is de­signed to pass through the gut, pick­ing up metabo­lites al­most like a sponge, then pass through the stool, low­er­ing metabo­lite lev­els in the gut, and there­fore in the brain. It’s an oral med­ica­tion that would need to be tak­en three times per day with food (though Camp­bell says they’re work­ing on for­mu­la­tions that could be tak­en twice or even once per day). The com­pa­ny re­cent­ly read out Phase Ia/IIb da­ta that showed the can­di­date was safe, and that it re­duced sev­er­al key GI neu­roac­tive mi­cro­bial metabo­lites in the plas­ma and urine.

“We think it has got a strong safe­ty pro­file, be­cause we don’t need to get it in the body or in­to the brain at all in or­der for it to work,” Camp­bell said.

Ax­i­al is plan­ning on launch­ing a Phase II tri­al soon, which should read out in 2023, Camp­bell said. They’ve al­so got pre­clin­i­cal pro­grams in Parkin­son’s dis­ease and on­col­o­gy in the works.

When asked if an IPO is in the fu­ture, Camp­bell re­spond­ed with a chuck­le: “No idea.”

“We’re so fo­cused right now on just get­ting this ex­e­cu­tion to­ward our mile­stones and (mov­ing) our pro­grams ahead,” he added.

Aus­tralian VC firm On­eVen­tures led Ax­i­al’s lat­est round along with the Uni­ver­si­ty of Tokyo In­no­va­tion Plat­form Com­pa­ny. The Autism Im­pact Fund, Corun­dum Sys­tems Bi­ol­o­gy, the Long­wood Fund, Sev­en­ture Part­ners, Tai­ho Ven­tures, and Do­main As­so­ci­ates al­so chimed in.

Ax­i­al is one of sev­er­al mi­cro­bio­me com­pa­nies ex­plor­ing the gut-brain ax­is, in­clud­ing Kally­ope, which land­ed a $112 mil­lion Se­ries C round last year. No­vo Nordisk has dipped its feet, ink­ing a part­ner­ship with Kally­ope in obe­si­ty and di­a­betes back in 2018.

“Autism and Parkin­son’s are the tip of the ice­berg for us,” Camp­bell said. “This is a very dif­fer­ent way and we hope this is re­al­ly like a phase shift in how we think about neu­ro­log­i­cal dis­or­ders.”

89bio said its drug was better than placebo at lessening fibrosis without worsening nonalcoholic steatohepatitis, or NASH, in two of three dose groups.

The San Francisco biotech said it thinks the Phase IIb data pave the way for a potential Phase III, following in the footsteps of another biotech in its drug class, Akero Therapeutics. To fund a late-stage study, CEO Rohan Palekar told Endpoints News 89bio “would need to raise additional capital,” with the company having about $188 million at the end of last year.

The National Institutes of Health has again declined to use so-called “march-in” rights to lower the price of Astellas and Pfizer’s prostate cancer drug Xtandi despite being invented at UCLA with grants from the US Army and NIH.

“Given the remaining patent life and the lengthy administrative process involved for a march-in proceeding, NIH does not believe that use of the march-in authority would be an effective means of lowering the price of the drug,” NIH told prostate cancer patients Robert Sachs and Clare Love, in a letter shared with Endpoints News. The institutes’ analyses found Xtandi “to be widely available to the public,” an indication that there was not a pressing need for the US to act.