Ophthalmology has become a focal point for private equity and venture capitalists in the past 18 months, despite being a small niche in the biopharmaceutical space.
Ophthalmology has become a focal point for private equity and venture capitalists in the past 18 months, despite being a small niche in the biopharmaceutical space, according speakers at the recent Demy-Colton Virtual Salon Series - Ophthalmic Drug Delivery: Eye on Innovation.
That interest is driven by significant innovation, a growing patient population with a history of paying for procedures in cash, and some big pharma failures that, combined, are expanding opportunities for small players in this market.
For example:
OcuTerra is developing OTT166, a disruptive, non-invasive treatment for retinal disease. It is in Phase II trials. Delivered in eyedrop form, “It is able to regulate responses to growth factors that contribute to diabetic retinopathy,” Kerrie Brady, CEO, said. “By providing a non-invasive treatment early, physicians can watch and treat rather than watch and wait.”
Ashvattha Therapeutics, Inc. is developing hydroxyl dendrimer therapy (HDT) for wet age-related macular degeneration (AMD). The therapy enables at-home administration. “It will be in the clinic next year,” Jeffrey Cleland, Ph.D., chairman, CEO, president and co-founder, predicted. HDT is designed to precisely target reactive macrophages and retinal pigment epithelial cells (RPEs) after systemic administration.
“Ocuphire Pharma is beginning Phase III development for Nyxol® for presbyopia. It improves night vision – including reducing the glare and halos caused by Lasik procedures or aging – and reverses dilation (after eye exams, for example) by reducing pupil size,” Mina Sooch, founder, CEO and president, said. Because it reduces the pupil diameter, it also improves contrast sensitivity. In Phase II trials, near-vision acuity improved by three lines or more in 61% of treated patients one hour after treatment, compared to 28% of receiving placebo. Therefore, it may eliminate the need for reading glasses for some patients.
Pixium Vision – the only device company on the panel – “is developing a brain-machine interface technology in which a retinal implant, special glasses, and a computer work together to restore vision in patients with AMD,” Lloyd Diamond, president and CEO, said. Papers published in Nature and in Opthalmology showed that this bionic vision system, dubbed PRIMA, restored a level of central vision acuity in clinical trials that enabled patients to read eight-point font on a computer screen despite being legally blind. “They couldn’t read of see faces without our technology,” he said. “It seems ‘Star Trekkie’ but this is reality. We plan to apply for the CE mark in Europe in late 2022 or early 2023.”
Diabetic retinopathy is a large target for many companies. It is the leading cause of blindness in working-age adults, and incidents are expected to double by 2030. Yet, the standard of care remains “watch and wait.” That leaves patients without effective early interventions and, when treatments are used, their burden is high. Currently, intravitreal injects are common.
Biopharma companies are looking to minimize the need for such injections with implants, reservoirs, depot technology, gene therapy, as well as the more usual topical, oral and systemic delivery options.
“This is a new frontier to avoid intravitreal injections, so more patients can be treated,” Cleland said.
Small molecule VEGF inhibitors are a common therapeutic approach, but their challenges involve safety, visual acuity and systemic signals, Sooch pointed out. “Therefore, Ocuphire took a different approach in developing APX3330 for diabetic retinopathy and diabetic macular edema.” This tablet, taken twice daily, works upstream of known targets to decrease abnormal angiogenesis and inflammation.
The rapid advances being made in ophthalmology are creating a highly competitive landscape that is expanding rapidly. Throughout the ophthalmic industry, “The degree of innovation is wonderful, and stunning advances are already here,” Brady said.
She pointed to artificial intelligence diagnostics, which the FDA first approved in 2016. Now, AI is being applied to diabetic retinopathy, where accessibility to screening is a barrier. “With machine learning and AI, patients can be diagnosed by experts remotely, using a smart phone, from their general practitioner’s office.
“With the use of more sophisticated scans, we can see what’s going on at the back of the eye,” she continued. “That lets us identify those most likely to progress rapidly… stratifying the patient journey and treating patients earlier so they don’t lose their vision.”
As novel therapies advance, interest in strategic partnering is heating up. As Sooch noted, “Interest in strategic partnering was quiet last year during COVID and is picking up again. That’s mostly because there were some failures at large pharmas in retinal programs, which left a big gap. Therefore, there’s opportunity for innovators to fill the pipeline.”
She said, for example, that presbyopia is garnering particular interest.
These opportunities are global, linked to an aging population and the increasing hours people – even young children – spend in front of computer screens.
While investors are interested around the world, Sooch said she is seeing a lot of interest from China in terms of strategic partnering. Diamond later mentioned “a tremendous amount of aggressive interest from China,” largely in terms of mergers and acquisitions.
It’s important to realize through, that regulatory success does not ensure commercial success, Brady pointed out. Partners and investors are interested in differentiated products that deliver true clinical value. To that end, “Companies used the time last year (when investors were focused on COVID-19 products) to further develop their programs and build greater value.”
Now they’re better positioned for partnerships or acquisitions.
Many of those investors are generalists, Diamond said. “In the past 18 months, we raised more than €25 million – we’re based in France – from generalized investors in the U.S. Two-and-a-half years ago, we wouldn’t have attracted general investors.”
The difference, he explained, is that life science investors ran toward COVID-19 programs, which left a vacuum that general investors filled.
Now, companies are positioned to capitalize on a growing number of opportunities therapeutically and geographically, to deliver more effective therapies ever earlier in the patient journey.
