Carmot Therapeutics is catching up to companies with drugs designed to hit receptors that have become hot targets for metabolic diseases such as diabetes and obesity. But clinical-stage Carmot believes its approach offers a better way of drugging those targets compared to blockbuster products marketed by Novo Nordisk and Eli Lilly. It’s now preparing to make its case to the public markets.
Without outlining specific financial terms, Carmot filed paperwork late Friday for its planned IPO. Renaissance Capital, an IPO research firm, penciled in a $100 million placeholder figure for the proposed stock sale. Berkeley, California-based Carmot has applied for a Nasdaq listing under the stock symbol “CRMO.”
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Carmot’s two most advanced programs are both peptides designed to hit GLP-1 and GIP, two receptors whose activation triggers blood sugar-lowering effects and appetite control. CT-388 is a once-weekly injectable drug in early-stage testing for treating obesity and type 2 diabetes. CT-868 is a once-daily injectable drug that hits the two key receptors to manage blood sugar in type 1 diabetes patients who are overweight or obese.
Carmot discovers drugs with a technology platform called Chemotype Evolution. The company says its technology generates drug candidates with potent but selective signaling properties. Other attributes include improvement in how much of the drug is available in the body to offer an effect, the proportion of the drug that has an active effect, and the drug’s half-life. The Carmot technology also enables the design of drugs with biased signaling, which is the emphasis of certain signaling pathways favorable for the desired effect and the de-emphasizing of signals that could lead to harmful or unwanted effects. The result, the company hopes, is drugs that work better and offer effects that last longer.
GLP-1 is already targeted by Novo Nordisk’s Ozempic, for type 2 diabetes, and Wegovy, for weight loss. Though Carmot did not discover GLP-1 and GIP, it believes its drugs’ biased signaling for those targets is a key advantage compared to other products. For example, the company points to Lilly’s tirzepatide, first approved by the FDA as Mounjaro for type 2 diabetes and approved earlier this month as Zepbound for chronic weight management. While the Lilly drug is biased to GLP-1, Carmot says the molecule is unbaised to GIP.
“Although the respective contributions of GLP-1 and GIP to the overall effects of tirzepatide are not known, we believe that CT-388’s designed signaling bias could lead to greater weight loss and glycemic control as well as more favorable tolerability results,” the company said in the filing.
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Carmot is still gathering the clinical evidence to support that claim. A Phase 1/2 test of CT-388 in type 2 diabetes is comparing the Carmot drug to a placebo. In June, the company reported proof-of-concept data showing statistically significant average weight loss of 8.4%, or about 17 pounds, in the highest-dose group. Adverse effects were mainly gastrointestinal, which is consistent with rest of the drug class. Data from other cohorts are expected in 2024 and 2025.
Carmot has already tested CT-868 in patients with type 2 diabetes, posting Phase 1 results showing a lowering of blood sugar and Phase 2 data showing reductions in hemoglobin A1C, a biological indicator of blood sugar levels. Now a Phase 1 mechanism of action trial is underway testing the peptide as an adjunct to insulin for treating obese or overweight type 1 diabetes patients. This trial is comparing the Carmot drug to a placebo and Novo Nordisk’s Victoza, an older GLP-1 agonist that’s approved for managing blood sugar in patients with type 2 diabetes. Data are expected in the first half of 2024. The company has also started a Phase 2 test proof-of-concept study; preliminary data are expected in the second half of next year.
The next step for obesity and weight management drugs is oral dosing—drugs that hit GLP-1 with small molecules formulated as pills. Eli Lilly and Pfizer have reached Phase 2 testing with their respective small molecules. Structure Therapeutics is on their heels with encouraging early-stage data for its once-daily oral small molecule, GSBR-1290.
Carmot’s oral contender is CT-966, which is in development for treating obesity and type 2 diabetes. The company believes the biased signaling of this molecule could improve its therapeutic window, the dose range that balances safety and efficacy. Last month, Carmot reported interim Phase 1 data that support once-daily dosing of the drug and tolerability results consistent with other GLP-1 agonist drugs. Additional data from the Phase 1 test are expected in the first half of 2024. Carmot plans to release preliminary Phase 1b data in type 2 diabetes in the second half of next year.
Carmot can boast of one FDA-approved molecule discovered with its technology. Under a partnership with Amgen, Chemotype Evolution led to the discovery of sotorasib, brand name Lumakras, the small molecule that won accelerated FDA approval in 2021 for treating cases of non-small cell lung cancer driven by KRAS G12C mutations. The partnership put Carmot in line for royalty payments from Amgen’s sales of Lumakras.
In March, Carmot spun out a company called Kimia Therapeutics, which holds a license to Chemotype Evolution for applications of the technology in oncology as well as immunology and inflammation. Carmot retained equity in Kimia and stands to receive milestone payments tied to that company’s progress with its R&D. The two companies have other ties. Kimia is supporting Carmot’s work in metabolic disease under a research services and collaboration agreement. The three-year deal calls for Carmot to pay Kimia $375,000 annually for at least five full-time workers, according to the IPO filing. Kimia is led by CEO Stig Hansen, the co-founder and former CEO of Carmot. Carmot is now helmed by Heather Turner, who was the company’s chief operating officer.
Carmot has raised $371.4 million since its 2008 founding, according to the IPO filing. The most recent financing was a $150 million Series E round in May led by Deep Track Capital. The Column Group is Carmot’s largest shareholder, owning a 40.7 pre-IPO stake, according to the filing. Beaming Star Global holds a 9.32% stake, followed by RA Capital Management’s 7.2% stake in the company.
As of the end of the third quarter of this year, the company reported having $125.9 million in cash and cash equivalents. The company plans to apply that cash and the IPO proceeds toward development of its three clinical-stage metabolic disorder programs, though funding amounts are not yet specified for each drug candidate.
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