The first full week of April closed with two more clinical-stage biotech companies joining the Nasdaq, each developing a drug to address rare disorders.
First up was VectivBio, which raised $127.5 million to complete pivotal tests of a drug candidate that could challenge a product currently marketed by Takeda Pharmaceutical. Late Thursday, the biotech priced its offering of 7.5 million shares at $17 each, the midpoint of its targeted price range.
Basel, Switzerland-based VectivBio is a rare disease drug developer that is initially focusing on gastrointestinal disorders. Its first disease target is short bowel syndrome, which is a condition in which the physical loss or the loss of function of a significant part of the intestine leaves the organ unable to absorb fluid and nutrients. The syndrome can be caused by physical trauma or by some other disease, such as ulcerative colitis or cancer, that affects the intestines. The resulting intestinal dysfunction requires patients to receive nutrients and fluids via a central line catheter.
The body already produces a peptide that can help restore intestinal function. Glucagon-like peptide-2 (GLP-2) is normally secreted by the intestine and released into the blood following the ingestion of nutrients. This peptide has been observed to stimulate intestinal villi, which are cells that line the small intestine, VectivBio said in its IPO filing. But native GLP-2 is unstable in the blood with a half-life of only seven minutes. Therapeutic approaches to short bowel syndrome have centered on developing versions of the peptide that last longer.
Takeda has commercialized teduglutide, its version of GLP-2 that is given as a once-daily subcutaneous injection. The product, marketed as Gattex in the U.S. and as Revestive in Europe, also requires a multi-step preparation process in which the exact dose is calculated according to the patient’s weight. VectivBio notes in its filing that the Takeda drug brings frequent problems, including injection site reactions and abdominal pain. The company added that teduglutide also falls short in improving a patient’s quality of life and has shown no benefit in the more than half of short bowel syndrome patients whose colon is in continuity.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
VectivBio’s version of GLP-2 is called apraglutide. The Swiss company aims to offer patients less frequent dosing and better outcomes. Its drug is currently in Phase 3 testing in short bowel syndrome patients who have intestinal failure. VectivBio also plans to evaluate its drug in other rare gastrointestinal disorders that could benefit from GLP-2 activation, including graft-versus-host disease.
Apraglutide is a well-traveled drug, having changed hands several times in its history. The peptide was initially developed by Swiss company Ferring Pharmaceuticals, which licensed the drug to GLyPharma Therapeutic of Montreal in 2012. GLyPharma was acquired by Swiss company Therachon Holding in 2018. The following year, Pfizer acquired Therachon, which in turn spun off VectivBio as a separate company for the purpose of continuing apraglutide’s development.
VectivBio has raised about $144 million since its founding. The company’s largest shareholder is Versant Ventures with a 13.75% post-IPO stake, according to the prospectus. OrbiMed is the second largest shareholder with a 12.47% stake in the company after the IPO.
The company plans to use about $90 million of the IPO proceeds to complete the Phase 3 study of apraglutide in short bowel syndrome. The company also plans to complete a Phase 2 test of the short bowel syndrome patients whose colons are in continuity. Another $10 million is set aside for advancing apraglutide into mid-stage testing in graft-versus-host disease.
VectivBio’s shares will trade on the Nasdaq under the stock symbol “VECT.”
Reneo Pharma rounds up $94M to ramp up mitochondrial function
Reneo Pharmaceuticals raised $93.8 million after pricing its offering of 6.25 million shares at $15 per each, which was the low end of its $15 to $17 price target. Those shares will trade on the Nasdaq under the stock symbol “RPHM.”
San Diego-based Reneo is developing drugs for rare, inherited disorders affecting mitochondria, the energy generators of cells. Lead drug candidate REN001 is a small molecule designed to selectively activate PPAR, a family of nuclear receptors. Doing so is intended to regulate cellular energy generation by modulating the expression of genes involved in mitochondrial function, according to Reneo’s IPO filing. The company adds that this approach may increase production of new mitochondria.
Reneo has advanced its lead drug to a global Phase 2b study in patients with primary mitochondrial myopathies, which the company estimates affect about 66,000 people in the U.S. The double-blind, placebo-controlled study is slated to begin enrollment in the first half of this year. The company also plans an open-label, long-term safety study in a subset of patients from the Phase 2b trial. Results are expected in 2023. Reneo said in the IPO filing that it expects positive results from the studies could support submissions seeking approvals in the U.S. and Europe.
About $20 million of the IPO proceeds are earmarked for clinical development of REN001 in primary mitochondrial myopathies. Another $15 million is set aside for early clinical development of that drug in long-chain fatty acid oxidation disorders.
Reneo was formed in 2014. REN001 and other compounds were licensed from vTv Therapeutics in 2017. Following the IPO, New Enterprise Associates is the Reneo’s largest shareholder with a 17% stake, according to the prospectus. Novo Holdings owns 11.4% of the company.
Photo: Angela Weiss/AFP, via Getty Images
