BioPharma, Pharma

Exo Therapeutics adds $78M as cancer, inflammation drugs march toward clinic

Biotech startup Exo Therapeutics aims to overcome the challenges of drugging proteins by targeting exosites, locations that modulate enzyme activity. The company has four small molecule drug candidates for cancer and inflammation, and the company plans to use the $78 million in new financing to advance them toward human testing.


The traditional way of drugging a protein is to get a small molecule to bind to it, but that’s not always feasible. Biotech startup Exo Therapeutics is developing a way to drug proteins by targeting places distant from a traditional binding site, and by doing so, affecting enzymes to produce a therapeutic effect.

Cambridge, Massachusetts-based Exo has drug candidates that take this enzyme modulating approach to address cancer and inflammation and it has raised $78 million to support them as they advance toward clinical trials. The Series B round of funding announced Tuesday was led by Nextech Invest, a new investor in the company.

The traditional binding places for small molecule drugs are called active sites. For some proteins, the active site is not available. Binding to another location on a protein called an allosteric site offers an alternative, but it could also have the unintended consequence of affecting other enzymes or blocking activity that you don’t want the drug to stop.

Exo aims to hit locations on a protein called exosites. The company says that these binding pockets have the ability to reprogram enzyme activity to produce a therapeutic effect. Unlike active or allosteric sites, exosites are unique to a specific enzyme/substrate interaction. Exo claims that binding to them offers the potential of providing a better therapeutic window, fewer off-target effects, and fewer side effects. This approach also offers the potential to address many more diseases. Of the estimated 10,000 proteins involved in human disease, about 700 of them are currently accessible as drug targets. The company claims that targeting exosites will expand the universe of potential drug targets.

The exosites are discovered using a technology called ExoSight. Exo’s research has produced a pipeline of four preclinical small molecules so far, three in oncology and one in inflammation. The company has not disclosed the specific targets of these drugs. In addition to supporting the ongoing development of its pipeline, Exo said that the new financing will be used to pursue new targets.

The science of Exo’s approach is based on research from the Harvard University laboratory of David Liu, a professor of chemistry and chemical biology, and Alan Saghatelian, a professor at the Salk Institute for Biological Studies. Their work initially focused on insulin degrading enzyme (IDE), which degrades both insulin and glucagon. The scientists found that blocking the IDE exosite blocks the degradation of insulin but does not affect the protein’s active site or glucagon degradation. That research, which was published in 2019 in Nature Chemical Biology, led to the formation of Exo. The startup launched last December with $25 million in Series A funding.

Other investors in Exo’s latest financing include BVF Partners, Samsara Biocapital, Morningside, Casdin Capital, Newpath Partners, Novartis Venture Fund, CRV, and 6 Dimensions Capital.

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