April 11, 2017
By Mark Terry, BioSpace.com Breaking News Staff
Cirius Therapeutics announced the completion of a Series A financing up to $40 million. The round was led by Frazier Healthcare Partners and Novo A/S. New investors are Adams Street Partners and Renaissance Venture Capital Fund. Existing investors include Hopen Life Sciences Ventures.
Previously known as Octeta Therapeutics, Cirius is located in Kalamazoo, Mich., and now San Diego, Calif. The Kalamazoo site will remain as its research-and-development center. Administrative headquarters will be in San Diego.
The company plans to use the proceeds of the financing to wrap up an ongoing EMMINENCE Phase IIb trial of MSDC-0602K for the treatment of non-alcoholic steatohepatitis (NASH) and liver fibrosis.
NASH, sometimes called the “silent liver disease,” resembles alcoholic liver disease, but appears in people who drink little or no alcohol. However, it can be quite severe and lead to cirrhosis. According to the National Institute of Diabetes and Digestive and Kidney Diseases, NASH affects 2 to 5 percent of people in the U.S. There are currently no specific treatments aside from weight loss, increased physical activity, and avoiding alcohol and unnecessary medications.
The company’s new chief executive officer is Bob Baltera. The company also hired Howard Dittrich as chief medical officer and Brian Farner as chief business officer. All three worked at Laguna Pharmaceuticals, which shuttered in December 2015.
Laguna had interesting data, but its work on atrial fibrillation had safety issues. “We shut that down,” Baltera told Endpoints News’ John Carroll, and gave about half of the money (which would have been about $15 million) back to the investors.”
In 2011, Baltera oversaw the $475 million acquisition of Amira by Bristol-Myers Squibb . Frazier Healthcare Partners approached Baltera, Dittrich and Farmer, offering them positions as entrepreneurs-in-residence. Their new job is with Cirius.
Cirius’ approach will be insulin sensitization. “If you look at NASH,” Baltera said to Carroll, approximately half of NASH patients are Type 2 diabetics. “It appears that insulin resistance is really a trigger of liver disorder, and there’s been some clinical work that looks at first-generation insulin sensitizers, which showed a large impact on the disease.”
Also joining the company’s board are Dan Estes, of Frazier Healthcare, and Nilesh Kumar, of Novo A/S. Existing represents include David Van Andel, Mike Jandernoa and Robert Zerbe.
“At Frazier, we believe the future of NASH therapies will be a multi-drug approach, with a need for therapies that address the underlying metabolic drivers of disease, as well as resultant fibrosis and inflammation,” Estes said in a statement. “We see a distinct opportunity for MSDC-0602K to become a cornerstone therapy in NASH, both as monotherapy but ultimately as part of combination approaches.”
The drug is an oral, once-daily insulin sensitizer that appears to avoid the safety issues related to first-generation insulin sensitizers. The Phase IIb EMMINENCE trial is comparing three doses of the drug to placebo in NASH patients with fibrosis. Data is expected in 2019.
NASH is an area a lot of companies have their eyes on. In September 2016, Dublin-based Allergan acquired San Francisco-based Tobira Therapeutics , which focuses on NASH with Cenicriviroc (CVC) and Evogliptin. On September 21, 2016, Allergan acquired Akarna Therapeutics, based in San Diego, which has a lead candidate for NASH and other liver diseases.
Genfit (GNFTF) has projected the worldwide market for NASH treatments to exceed $30 billion. SeekingAlpha generally downgrades that to about $10 billion, but it’s still a sizable market.
Other companies working in NASH include Intercept , Genfit , Gilead Sciences , Novo Nordisk , Shire , Novartis , Galmed (GLMED) and Conatus.
Of Cirius, Carroll writes, “Small company. Single asset. Potentially a major market drug with a huge Phase III requirement. That’s the profile of a company styling itself for a trade sale ahead of a pivotal program, which few private, venture-backed biotechs could ever afford to pay for. Baltera is quick to concede that a post-Phase IIb sale could be one successful outcome. But he offers one other scenario: Mounting an IPO and using the money from that to pay for Phase III.”
