The emerging class of therapies that treat disease by using the cellular process of protein degradation focused first on cancer. But this approach also has potential applications in immunology, and Lycia Therapeutics is among the companies taking protein degradation in this direction. The startup now has $106.6 million to advance its research into clinical testing.
Targeted protein degradation involves marking a disease-causing protein with a molecular tag that identifies it for disposal by a cell’s built-in machinery for getting rid of old or damaged proteins. Most of the protein-degrading therapies in development target proteins inside of a cell. South San Francisco-based Lycia aims to treat disease by targeting disease-causing proteins that are outside of a cell or are found bound to the cellular membrane. Lycia’s drugs are lysosomal targeting chimeras, or “lytacs,” which direct disease-causing proteins to a cellular disposal system called the lysosome.
Lycia was formed by venture capital firm Versant Ventures. The startup launched in 2019, emerging from Versant’s Inception Sciences Discovery Engine. Lycia’s research initially focused on developing antibody-based lytacs. The scope of its lytac approach now also includes bispecific antibodies and small molecules.
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Lycia has one big pharmaceutical partner. In 2021, Eli Lilly paid $35 million up front to begin an alliance spanning up to five drugs for undisclosed indications. The targets for Lycia’s internal pipeline also remain undisclosed, but with the new funding it now says it’s moving toward the clinic with programs for autoimmune and inflammatory diseases. In a prepared statement, Lycia President and CEO Aetna Wun Trombley said her company’s lytac degraders address “difficult-to-drug targets, including many that, to date, have been intractable.”
Venrock Healthcare Capital Partners led Lycia’s Series C financing, which included participation from new investors Janus Henderson Investors, Marshall Wace and Franklin Templeton as well as the startup’s earlier investors.
Here’s a recap of some other recent biopharmaceutical industry financings:
—Bluejay Therapeutics, developer of drugs for viral and liver diseases, raised $182 million to continue clinical development of a lead program in Phase 1/2 testing for chronic hepatitis B and chronic hepatitis D. The drug, BJT-778, is a monoclonal antibody designed to block hepatitis B surface antigen, which neutralizes and clears virus particles from both hepatitis B and D. This approach is also intended to deplete hepatitis B surface antigen-containing subviral particles, which the San Mateo, California-based company says may help to reconstitute a patient’s antiviral immunity and contribute to a functional cure for chronic hepatitis B viral infection. The Series C round was co-led by Frazier Life Sciences and an unnamed life science-focused institutional investment firm.
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—Immune diseases-focused Attovia Therapeutics reeled in $105 million as it prepares to enter the clinic later this year. The Fremont, California-based company has a technology platform to develop drugs it calls “attobodies,” which are biologic drugs with properties that include stronger potency, a modular construction that can be engineered for multi-specific targeting, and tunable half-life that can range from hours to weeks. The most advanced attobody is ATTO-1310, which is the company says is on track to enter the clinic around the end of this year for the treatment of atopic dermatitis and other pruritic diseases. Attovia expects to nominate a development candidate for ATTO-002 in the second half of 2024 and advance the candidate to an investigational new drug application in 2025. Attovia’s Series B financing was led by Goldman Sachs Alternatives.
—Aardvark Therapeutics raised $85 million in Series C financing for ARD-101, an experimental treatment for Prader-Willi syndrome, a rare, inherited metabolic disorder that causes ravenous hunger leading to obesity. The drug works by activating the TAS2 receptor to stimulate cells of the digestive tract to release multiple gut-peptide hormones, including GLP-1 and the satiety hormone CCK, which activates gut-brain neurologic signaling to mediate feelings of hunger. In addition to supporting the completion of clinical development of ARD-101, Aardvark said the financing will also support efforts to demonstrate that the molecule’s mechanism of action is complementary to GLP-1 drugs currently used to treat obesity. Decheng Capital led Aardvark’s Series C financing.
—Zenas Biopharma, a clinical-stage developer of drugs for inflammation and immunology, raised $200 million. The Waltham, Massachusetts-based company’s lead drug candidate is obexelimab, a bifunctional antibody that binds to CD19 and FcyRIIb to block the activity of B cells, plasmablasts, and CD19-expressing plasma cells. A Phase 3 study is underway testing the Zenas drug in IgG4-related disease. In addition, two placebo-controlled Phase 2 studies are planned in multiple sclerosis and systemic lupus erythematosus while an open-label Phase 2 study is ongoing in warm autoimmune hemolytic anemia. Obexelimab was licensed from Xencor. SR One led Zenas’s Series C financing.
—Flagship Pioneering unveiled its latest startup, the proteome-focused Prologue Medicines. The platform technology of Prologue discovers proteins with therapeutic potential by exploring the viral proteome, which is much larger than the human proteome. The startup’s initial focus is immunology, oncology, and metabolic disorders. Like other startups that spring from Flagship’s labs, Prologue is backed by the customary $50 million in financing.
—BridgeBio Pharma, a company whose business model involves identifying and acquiring drug candidates from academia and forming subsidiaries to develop them, spun off a cancer-focused subsidiary with $200 million in private financing. BridgeBio Oncology Therapeutics (BBOT) is breaking away from its parent with a pipeline of drug candidates that address RAS, a family of cancer-driving proteins that was considered undruggable not so long ago.
BBO-10203 blocks the interaction of RAS and PI3Ka. BBOT expects to file an investigational new drug application with the FDA in the current quarter and if cleared, begin enrolling patients later this year. Approved KRAS G12C inhibitors marketed by Amgen and Bristol Myers Squibb block this protein in its inactive or “off” state. BBOT’s is developing BBO-11818, a pan-KRAS inhibitor designed to block KRAS G12C whether the protein is “on” or “off.” The company expects to file an investigational new drug application for this molecule in 2025. BBOT’s financing was led by Cormorant Asset Management and co-led by Omega Funds.
—Reunion Neuroscience raised $103 million to support Phase 2 development of RE104, a fast-acting, short-duration psychedelic that the company is developing as a postpartum depression drug. Morristown, New Jersey-based Reunion previously operated as the publicly traded company Field Trip Health. It was taken private last year by MPM BioImpact. That firm and Novo Holdings led Reunion’s Series A financing.
—Delphia Therapeutics launched with $67 million in financing to develop a new class of cancer therapies based on a mechanism called activation lethality. Some available cancer drugs, such as PARP inhibitors, employ synthetic lethality, leveraging a genetic vulnerability to cause the death of cancer cells. Delphia’s approach overloads cell stress pathways of an oncogene, which becomes lethal to cancer cells. The Cambridge, Massachusetts-based startup’s Series A round was led by GV, Nextech Invest, Polaris Innovation Fund, and Alexandria Venture Investments.
—A growing number of startups are developing new drugs that form covalent bonds with their targets. But these potential medicines are all small molecules. Enlaza Therapeutics claims to be the first to bring covalency to biologics and it has raised $100 million in Series A financing to support its R&D. J.P. Morgan’s life sciences group led the La Jolla, California-based startup’s Series A financing.
—Clinical-stage Endeavor Biomedicines reeled in $132.5 million to support its two lead programs, one a small molecule for idiopathic pulmonary fibrosis and the other an antibody drug conjugate for solid tumors. The Series C financing was led by AyurMaya, an affiliate of Matrix Capital Management. San Diego-based Endeavor last raised money in 2022, a $101 million Series B round. The company called the new round a crossover financing, a type of financing that brings in firms that invest in both public and private companies and often precedes an IPO.
—Artificial intelligence-driven drug discovery startup Xaira Therapeutics launched with more than $1 billion in committed capital. Incubated by Arch Venture Partners and Foresite Capital, San Francisco-based Xaira was co-founded by David Baker, a professor of biochemistry and director of the Institute for Protein Design at the University of Washington School of Medicine. Xaira did not disclose which therapeutic indications it will pursue, but its launch announcement said the startup’s technology enables it to “generate, integrate, and learn from vast multidimensional data sets that comprehensively characterize disease-relevant biology at all scales, from molecules to people.”
—SynOx Therapeutics has $75 million for Phase 3 testing of emactuzumab in tenosynovial giant cell tumor (TGCT), a type of tumor that affects soft tissue around joints and tendons. The antibody, is designed to bind to the CSF-1 receptor, the same target of Deciphera Pharmaceuticals drug candidate vimseltinib. SynOx’s drug was originally discovered and developed by Roche. Forbion, HealthCap, and Bioqube Ventures led SynOx’s new financing.
—Corner Therapeutics, developer of personalized vaccines for cancer and infectious diseases, raised $54 million. Watertown, Massachusetts-based Corner is based on immunology research from Harvard Medical School. The startup says its vaccines “supercharge” dendritic cells, a type of immune cell, providing lifelong protection from disease. The company says its preclinical research demonstrated protective immunity from cancer and infection. The company now expects to enter the clinic in 2025. Corner’s Series A financing was led by Ziff Capital Partners.
—Metsera launched with $290 million and ambitions to bring competition to Novo Nordisk and Eli Lilly in the hot area of metabolic disorder drugs. The company’s clinical-stage pipeline spans oral and injectable medicines whose potential advantages include preserving muscle, less frequent dosing, and better efficacy and tolerability. New York-based Metsera was founded by Arch Venture Partners and Population Health Partners.
—Outrun Therapeutics launched with $10 million in seed financing for R&D of drugs that stabilize key proteins, keeping them out of the cellular system for disposing of old or damaged proteins. Spun out of the University of Dundee, the Dundee, Scotland-based startup says its approach has potential applications in oncology and neurology. Its lead program is a potential treatment for solid tumors. Other protein stabilization startups include University of California, Berkeley spinout Vicinitas Therapeutics and Stablix Therapeutics, which is based on research from Columbia University.
—Asher Biotherapeutics raised $55 million to support ongoing clinical development of AB248, a cytokine therapy engineered to activate the IL-2 pathway to treat cancer. The therapy is in a Phase 1a/1b trial evaluating it as a monotherapy and in combination with the Merck immunotherapy Keytruda for the treatment of advanced solid tumors. RA Capital Management led Asher’s Series C financing, which included participation from new investors AstraZeneca and Bristol Myers Squibb.
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