January 2, 2015
By Krystle Vermes, BioSpace.com Breaking News Staff
Israeli startup company Chiasma has raised $33.8 million, despite the fallout of a deal with Roche over the summer, netting the new money from a suite of investors including MPM Capital, Abingworth, 7-Med Health Ventures LP, ARCH Venture Partners and F2 and F3 Ventures. The potential agreement with Roche was worth approximately $595 million, according to Med City News.
As a result of the deal, Chiasma was set to receive $65 million up front, and $530 million would have been considered for development and commercialization milestones in the future. Chiasma’s lead candidate is oral octreotide, which is designed to treat acromegaly. The disease, which is the result of an excess of growth hormones, impacts about 5,000 people in the world.
Successful Funding
Thus far, Chiasma has shown promise in the industry as a firm dedicated to developing a line of oral drugs. Chiasma announced the closing of a funding round in July 2012 that brought in $38.5 million. At the time, this money went toward financing its drug, Octreolin, created to treat acromegaly. ARCH Venture Partners, 7 Med Health Ventures, F3 Ventures and Fredric Price all participated in the financing round.
“During the last year, Chiasma has made considerable progress as evidenced by the initiation of the phase 3 clinical trial of Octreolin for acromegaly, the preparation for a second indication -- neuroendocrine tumors -- for Octreolin and the completion of the necessary preclinical studies for its next drug candidate, which is expected to enter the clinic in the current quarter for a complication of CKD,” said Vincent Miles, who had just joined the board of the directors at the time.
The money was used to finish the pivotal Phase III trial that was begun on Chiasma. Additionally, it was utilized to research a new small molecule drug as a possible treatment for chronic kidney disease.
The Roche Agreement
The decision to collaborate with Roche came in 2013. Chiasma was intent on giving Roche the right to commercialize Octreolin.
“If approved, Octreolin would be an important alternative for patients with acromegaly, a disorder that develops when a person’s pituitary gland produces too much growth hormone,” said Hal Barron, chief medical officer at Roche. “Octreolin is an investigational oral regimen that avoids the painful injections of current treatment options.”
