Seeing a Better Way for Eye Drug R&D, Character Bio Lands $93M for Two Trials in Dry AMD

A clinical trial is typically the first look at how an experimental drug works in humans. Character Biosciences is entering the clinic with a trove of company-generated human data already in hand. These data inform Character’s approach to targets for the dry form of age-related macular degeneration and they also indicate which patients are most likely to respond to treatment. Now the startup has $93 million to achieve clinical proof of concept for its two lead programs.

The Series B financing announced Wednesday was co-led by aMoon and Luma Group, both new investors in Jersey City, New Jersey-based Character.

Age-related macular degeneration (AMD) damages the macula, the central part of the retina. In wet AMD, blood vessels form under the retina, leading to swelling and bleeding. In the more common dry AMD, thinning of the macula is driven by protein and lipid buildup. Both forms of AMD lead to the loss of a patient’s central vision. More than 18 million people in the U.S. age 40 and older have early-stage AMD. The dry form is more prevalent, accounting for an estimated 85% of AMD cases, according to the American Society of Retinal Specialists.

While some drug research starts with the target, Character’s research started with patients. The rationale for this approach is the heterogeneity of dry AMD, meaning there are many factors at play in the development and progression of disease, factors that vary from patient to patient, said Character CEO Cheng Zhang. In collaboration with eye treatment centers across the country, Character enrolled more than 6,500 patients with intermediate AMD and advanced dry AMD. Study participants did not receive any treatment. The observational study collected data from electronical medical records and imaging. To date, the study has patient data spanning about seven years.

Character used artificial intelligence to analyze the data it had amassed. More than looking for genetic signs of disease incidence, Character looked for the signs of disease progression. Doing so matches up with how a regulator would evaluate an experimental treatment’s effect as it weighs potential approval, Zhang said. This approach also informs clinical trial design. Character can prioritize trial endpoints where the drug could have maximal effect.

“We’re looking to treat disease progression,” Zhang said. “What Character has added to the selection of these targets is that association with the FDA-approvable endpoints of clinical progression. That’s the novel insight.”

Character drug CTX114 addresses a genetic loss of function associated with AMD risk and progression. This progression is also associated with the growth of lesions from geographic atrophy (GA), which is retinal damage that develops from late-stage dry AMD. Drugs in the class of therapies called complement inhibitors are currently available for GA. Apellis Pharmaceuticals’ Syfovre won its FDA approval in 2023; later that year, Astellas Pharma’s Izervay won its FDA nod. Both drugs block particular complement proteins to slow GA progression.

While CTX114 is also a complement inhibitor, Zhang said this Character drug addresses a different node in the complement pathway. Based on insight from the observational study, Zhang said Character found this node has stronger genetic support as a target. He also contends that CTX114 is a better engineered protein drug with preclinical data indicating it has the potential to more effectively reduce the rate of GA progression while also preserving vision.

With Character drug candidate CTX203, the biotech aims to prevent GA. That’s important because by the time patients develop GA, they’ve already experienced irreversible vision loss, Zhang said. Character’s observational study included the analysis of patients whose AMD progression is associated with accumulation of lipids. CTX203 is a complement inhibitor designed for lipid modulation. Zhang acknowledged that the targets of Character’s drugs have been previously associated with AMD. While the Apellis and Astellas drugs have de-risked the regulatory pathway for dry AMD and GA drugs, Zhang said Character’s drugs are not me-too therapies.

“We selected our target in the complement pathway and developed conviction in the target as well as the pathway itself in 2020,” he said. “It wasn’t following the approval of these drugs that we decided to work on a couple. We were actually guided by patient data in the first place.”

The genetic risk factors that would make patients suitable for a Character drug can be identified with already available assays, Zhang said. There’s potential for the two lead Character drugs to be used in combination, as there are patients who have both complement- and lipid-related genetic risk variants contributing to their disease. But the initial plan is to test the lead Character drugs separately, each in patients at a different stage of disease. Phase 1 testing for both is expected to begin later this year.

Character’s progress to date caught the eye of Bausch + Lomb. In January, Character announced a partnership with the eye health giant. The initial focus is AMD drug research, but the alliance could later expand to other eye diseases. Bausch + Lomb paid Character an undisclosed upfront sum and is also providing research funding. Zhang said this alliance does not encompass CTX203 and CTX114, which remain wholly owned by Character. But given the heterogeneity of AMD, other targets uncovered by Character’s research could lead to new drugs developed with Bausch + Lomb. Depending on the progress of this research, Character could receive milestone payments and royalties from sales of commercialized products.

Character formed in 2019 as the research division of Medicare Advantage insurance firm Clover Health. Initially known as Clover Therapeutics, this unit’s drug R&D was informed by the analysis of data from its parent and other sources that identified patient subgroups. In 2022, the company spun out of Clover Health. Rebranded as Character Biosciences, the startup was supported by $18 million in Series A financing.

Besides aMoon and Luma Group, the latest round included participation from Bausch + Lomb and Jefferson Life Sciences, as well as earlier investors Innovation Endeavors, Catalio Capital Management, S32, and KdT Ventures.

Photo by Flickr user Lily MAP via a Creative Commons license