This is another typical microcosm of Biotech's survival in the cold winter. The first layer of the story is that only one product of biotech has gained a whopping 4The $2.5 billion financing reflects the change in the main line of investment today. The second layer of the story is that the incubator behind the biotech has a story of self-help by "cracking" itself in the cold winter.
Written by |Erin Shi Ruoxiao.
Edit|Xiaoqin.
4.$2.5 billion! It's just a round A! There is only one product under development!
Last week, a foreign biotech company called Areteia Therapeutics (hereinafter referred to as Areteia) announced the completion of an additional Series A financing of $75 million, bringing the total amount of Series A financing to 4$2.5 billion (about $3.0 billion.)5.7 billion yuan). Among the investors, there are many well-known foreign investment institutions such as **, Sanofi, and ARCH Venture Partners.
In today's capital winter, 4The $500 million A round of financing can be described as quite "explosive", sorting out the main financing events at the beginning of this year, many start-ups can only raise tens of millions of yuan in the A round, and it is not easy to exceed 100 million.
The U.S. financing environment is still good. Many people in the industry made such an exclamation.
However, if you let go of the envy, you will find that Areteia has a lot of special features, and it can melt to 4 in the A roundAt $500 million, it's probably not surprising: The product, which is only dexpropacele, was valued at hundreds of millions of dollars more than a decade ago and is now in phase III clinical trials.
Furthermore, if you want to review the birth history of Arenteia, you can sort out a biotech survival guide in the cold winter: the incubator Knopp Biosciences spun off Areteia for independent financing, and at the same time packaged the team + technology platform to "sell", so as to maximize the value of product development while ensuring its own survival, which is really a good game of chess.
Perhaps this case tells us that pie never falls from the sky, and that confidence and perseverance are essential if you want to succeed, but at the same time, you must be smart enough and flexible. When a flexible business model architecture and perseverance are combined, it makes for a good story in the cold winter.
How can only one product be raised to 3 billion in Series A?
If you want to answer this question, you have to go back to the fundamentals.
As the saying goes, one minute on stage, ten years off the stage. Looking at the background, Areteia is just a company that was only founded in 2022, less than two years ago, and was co-founded by biotechnology company Knopp Biosciences and private equity firm Population Health Partners.
At the time of its establishment, the U.S. biotechnology capital market had already entered a downward cycle, but Arenteia staged a headwind. With 3With a Series A financing of 500 million US dollars, Areteia was listed on the "2022 Global Most Raised Biotech List" released by the industry's **Fierce Biotech, becoming one of the top 10 companies most favored by investors that year. Now, it has received an additional $75 million in Series A funding. Along the way, Areteia has been so favored by capital, but it is inseparable from the strong support of its products and team.
Looking at the product itself, Areteia has only one product, *dextropramipexole for eosinophilic asthma, which is in phase III clinical trials.
However, the right-handed pramipexole is actually "very promising". When it was handed over to Areteia , the product had already reached the late-stage clinical trial stage and was carried out relatively smoothly. The story also starts with the incubator Knopp Biosciences, which was founded in 2005 and made a lot of preparations in the early days, and most of the detours were smoothed out, accumulating a lot of experience for Areteia to successfully carry out clinical trials of dextropramipexole.
As early as 2010, Knopp Biosciences partnered with Biogen to advance the application of dexpipexole in ALS. When Biogen announced the failure of the Phase III clinical trial in 2013, the developers were disappointed, believing that Biogen's trial setup process was problematic and asked the other party to provide detailed data on enrolled patients. But no matter how much trouble and failure, Biogen's favor gave the initial valuation of this drug - the total amount of BD cooperation in 2010 was as high as 3$4.5 billion.
Of course, Knopp Biosciences never gave up faith in dextropramipexole and kept trying to find money and change indications, until its inhibitory effect on eosinophils was discovered, and everything turned around.
In the hands of Knopp Biosciences, dexpipexole has gone from project initiation to preclinical studies to phase 2 clinical trials. In order to bring dexpramipexole into the most expensive Phase 3 clinical trial in the cold winter, Knopp Biosciences made a thoughtful decision in 2022 and co-founded Areteia with capital, hoping to raise funds alone and bring dexpipexole into late-stage clinical trials. At this point, a rich second generation born with a golden spoon was announced.
More importantly, the market prospect of severe eosinophilic asthma corresponding to dextropramipexole also constitutes a huge imagination space for investors to Areteiia. According to one statistic, there are more than 300 million asthma patients worldwide, and severe eosinophilic asthma accounts for 838%。
Controlling severe eosinophilic asthma has become a key point in asthma**, and for this condition, the common use of this condition in the past needs to be improved.
According to the data, the drug works similarly to IL-5 biologics, which can inhibit the maturation and release of eosinophils, reduce the number of eosinophils, and then improve lung function. In September 2021, the results of the Phase 2 clinical trial of dexpramipexole in patients with moderate to severe eosinophilic asthma showed that the reduction in eosinophil count in patients with oral dextropramipexole was significantly associated with improved lung function. The trial met its primary endpoint and showed a dose-dependent eosinophilia that was significantly associated with improvement in pre-bronchodilator FEV1 in patients.
If dextropramipexole can successfully complete the phase III clinical trial and be approved** for the indication of eosinophilic asthma, it is expected to become an early ** means for the disease and become the first approved oral drug for eosinophilic asthma.
The strength of the Areteia team should not be underestimated.
After the incubation of Arenteia , although the figure of Knopp has long disappeared from the industry, the two scientists and founders of Knopp are still the directors of Arenteia and they have also found experienced management and R&D talents for Areteia to "hand over".
Arteia's CEO, Jorge Bartolome, is absolutely "right" about Areteiia's development. He was previously President of Janssen Canada, and also served as Senior Vice President and Head of the U.S. Business Unit for the Respiratory and Neuroscience business at GSK. Prior to entering industry, Arateia's Chief Scientific Officer from the earliest R&D team of D-Pramipexole has extensive experience in regulatory and academia, having worked at the National Institute of Allergy and Infectious Diseases (NIAID) for more than two decades, serving as principal investigator in multiple clinical trials for eosinophil-related diseases, and serving on the FDA's Advisory Committee on Lung Allergy Medications. In addition, Areteia has senior executives such as chief medical officer, chief commercial officer, and ** supervisor from GNC such as GSK and BMS.
Also worth mentioning is Population Health Partners, a private equity firm that incubates Aleteia in partnership with Knopp and has a global footprint that focuses on investing in late-stage projects and has driven eight drug approvals.
That is, round 4The financing of 500 million yuan includes a late-stage clinical product with huge market potential + a team with the dual bonus of R&D and management capabilities + endorsement from well-known institutions in the industry.
In a sense, the decision is very similar to when Abbott Laboratories put the "King of Medicine" Humira into AbbVie, and then waved his hand to let the latter fly solo. After AbbVie received the dividend, the stock price soared. If you calculate the rise in the stock prices of Abbott and AbbVie respectively, and even outperform Johnson & Johnson, which pursues "big" in the same period, it can be said to be a win-win situation.
Behind similar decisions, it not only reflects the deep love of an "old father", but also writes a self-help guide for Biotech in the cold winter.
"Cracking" self-help
Further, you will find that the second layer of this story is the drama of American biotechnology companies actively saving themselves in the battle for survival, and its methods have important reference significance for the majority of biotech in China.
If the protagonist of the story becomes the knopp who hatches Areteia, the story is equally exciting. As early as half a year before the incubation, in February 2022, Knopp Biosciences packaged and sold the company's main R&D leader, R&D team and KV7 potassium channel targeting platform to Bioh**En, becoming part of the latter's R&D department.
Now, judging from the results, the "cracking" self-help of knopp as a platform asset and the spin-off of products to establish a new company was the company's successful prediction of the industry environment at that time, and it was also a feasible way for biotechnology companies to save themselves in the market downturn.
A few years ago, the innovation bubble environment created by platform companies that can continue to export innovative products and build product portfolio advantages was broken, and the dream of many biotech founders to biopharma has finally become a "fantasy". This was followed by mass biotech companies laying off employees, cutting pipelines, and eventually going bankrupt and closing down as cash dried up.
One investor told e-drug managers that one of the important reasons why small biotechs are in trouble is that "they are overly focused on platform technology rather than hard clinical assets that can ultimately make money".
Returning to Knopp, as an unlisted company, it foresaw the difficulties it was about to face: the rupture of the previous cooperation with Biogen made it difficult for the core product dextroprapexole to find a new way out; In addition to dexpipexole, the company's potential best-in-class product KV7 potassium channel activator KB-3061 (BHV-7000), which has been developed for more than ten years, is about to enter clinical research and development, which will be another large investment.
At the same time, knopp has actually smelled the breath of the capital winter, if it continues to rely on its own hematopoiesis, whether it is the FIC and BIC products in hand, or the KV7 platform that has been built for ten years, it may be due to limited resources to slow down the progress, and it is even very likely that years of hard work will be "in vain".
Is it to realize product value, or to realize entrepreneurial value? Regarding this issue, Knopp chose the former: the team and platform were packaged and "sold" into BioH**EN, and the later product D-Primepexole established a new company separately to focus on a single product.
Looking back on this decision now, there is an element of luck and a strategic vision, and judging from the results, Knopp may have won this bet on the value of the product and the market environment.
Founded in 2013, Bioh**EN is also the birth of a golden spoon with science, which was jointly created by several professors at Yale University based on a new neurological discovery and patent, which makes Bioh**EN has been focusing on the research and development of new neurological drugs since its birth. At the same time, after its establishment, after many BD and mergers and acquisitions, Bioh**en achieved product sales revenue in a short period of time, and the first commercial product was sold for more than 500 million US dollars within 2 years of approval. It is worth noting that in 2022, Bioh**EN's CGRP-related assets have been acquired by Pfizer for $11.6 billion.
*:bioh**en official website).
It's a win-win deal. Irfan Qureshi, then vice president of neurology at Bioh**EN, saw the KV7 platform as highly complementary to Bioh**EN's existing neurology pipeline, so he retained the Knopp team and its development plans. Today, Knopp has become the ion channel R&D department of BioH**EN, and is still headed by the former CEO D**ID Pirman and Chief Scientific Officer Steven Dworetzky, and BHV-7000 has also become one of the five core products of BioH**EN, which successfully entered clinical trials in 2022, and is expected to start Phase 2 and 3 studies of focal epilepsy in the first quarter of 2024. In addition to conducting research on the indications for epilepsy, development for neuropsychiatric disorders such as major depressive disorder, bipolar disorder, and anxiety disorders is also carried out.
To sum up, Knopp's self-help experience can actually be written into a chapter of a biotech winter survival guide, which confirms a truth to the industry: the entrepreneurial platform of biotechnology companies is no longer the only pursuit, and "selling" big pharmaceutical companies is not the only way out. As long as you really care about the product and the clinical value, the "way" is correct, and the appropriate "technique" will naturally come out.
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