East Coast Biotech Roundup: Editas, Checkmate, Ovid & More

Xconomy Boston — 

Investors in the broader biotech indices may have been losing money this week, but East Coast startups were finding it fairly easy to come by. A gene editing startup corralled $120 million and a portfolio of big-name investors. A scientist working for decades in the RNA drug space emerged with funding for his latest startup. And a former Teva CEO laid the foundation to take his new startup public. We’ve got the details below.

—Cambridge, MA-based Editas Medicine was the first of a group of startups formed to exploit the gene editing technology CRISPR-Cas9 for human therapeutics. And this week, it became the first of those companies to land a big financing round backed by a slew of crossover investors. The $120 million round also included participation from Bill Gates and a vehicle set up by his science and technology advisor, Boris Nikolic. I spoke with CEO Katrine Bosley about the financing, how Editas intends to use CRISPR-Cas9, and the technical hurdles that have to be overcome.

—RNA therapeutics veteran and former Sarepta Therapeutics (NASDAQ: SRPT) chief scientific officer Art Krieg reemerged this week as the CEO of a new Cambridge-based startup called Checkmate Pharmaceuticals, which raised $20 million from venBio and Sofinnova Ventures. The startup has licensed a drug from struggling Swiss biotech Cytos Technology—another company from the venBio portolio—and plans to combine it with checkpoint inhibiting cancer drugs to boost their effectiveness.  It’s also gained access to Cytos’s method for creating “virus-like particles,” which look like viruses and are supposed to trick the immune system into responding.

—It’s taken former Teva Pharmaceutical Industries CEO Jeremy Levin about a year to form a biotech startup, New York-based Ovid Therapeutics, and assemble a group of crossover investors to fund it. Ovid raised a $75 million Series B this week to continue developing a group of drugs for rare brain diseases. Its lead drug, as I’ve written previously, is OV101, or gaboxadol—a drug once tested by Merck and Lundbeck as a sleeping pill. Ovid will begin two Phase 2 trials next year testing gaboxadol in patients with Angelman’s syndrome and Fragile X syndrome.

—Hedge fund boss Martin Shkreli led a $90 million funding round for his new startup, Switzerland and New York-based Turing Pharmaceuticals. Shkreli founded Turing last year and stocked it with a group of assets he bought from his former company, Retrophin (NASDAQ: RTRX)—from which he was ousted in a messy split. Turing put some of that cash to work immediately by paying Impax Laboratories (NASDAQ: IPXL) $55 million for the U.S. rights to a drug called pyrimethamine.

—Cambridge-based Eleven Biotherapeutics’s (NASDAQ: EBIO) shares were routed earlier this year when its lead drug, EBI-005, flunked a Phase 3 test in dry eye disease. But the stock rebounded a bit this week after Eleven started enrolling patients in a new Phase 3 trial testing the drug for severe allergic conjunctivitis (Eleven had previously disclosed plans in April to begin this trial in the second half of the year). The Boston Business Journal and FierceBiotech have more on Eleven’s plans for the study.

—Shares of Newton, MA-based Karyopharm Therapeutics (NASDAQ: KPTI) plummeted more than 40 percent this week after the company, in its latest earnings release, disclosed cases of sepsis in acute myeloid leukemia patients taking its experimental drug, selinexor, in a Phase 2 trial. Karyopharm amended the study protocol to dial down the dose of its drug.

—Hampton, NJ, and Needham, MA-based Celldex Therapeutics (NASDAQ: CLDX) also saw its stock fall this week. Shares slumped 20 percent after Celldex disclosed that based on discussions with regulators, it’ll likely have to go the normal approval route with its brain cancer vaccine rindopepimut (Rintega) and finish a full Phase 3 trial before filing papers with the FDA. Celldex officials had spoken publicly, albeit cautiously, of plans to talk to the FDA about an accelerated approval for rindopepimut off of its small Phase 2 trial. (Executives addressed their interactions with the FDA on a conference call this week—here’s the transcript). The company’s late-stage study is already underway.

—Boston-based Rhythm raised $40 million from OrbiMed, Deerfield Management and others that’ll be used to fund one of its subsidiaries, Rhythm Metabolic, and a drug that unit is developing for genetic obesity-related disorders like Prader-Willi Syndrome. Rhythm’s other subsidiary, Rhythm Pharmaceuticals, is developing a drug for diabetic gastroparesis; Actavis nabbed an option to buy that program outright last year after a Phase 2b trial.

—Huntington, NY-based startup Envisagenics won a $225,000 Small Business Innovation Research Award from the National Institutes of Health to help develop a technology it’s calling “SpliceCore,” a cloud-based software program to help researchers analyze and interpret genomic data. You can read more here about the startup, the most recent graduate of Accelerate Long Island.

—Kenilworth, NJ-based Merck (NYSE: MRK) is teaming up with Texas’ MD Anderson Cancer Center to test its cancer immunotherapy drug pembrolizumab (Keytruda) in tandem with a variety of other treatments, such as chemotherapy, radiation, or other anti-cancer drugs.  The three-year collaboration will lead to trials in pancreatic, liver, and gastroesophageal cancers, the first of which will begin this year.

—New York-based Bristol-Myers Squibb (NYSE: BMY) paid roughly $53 million to Uniqure (NASDAQ: QURE) as part of the collaboration between the two to develop gene therapies for cardiovascular diseases. Bristol shelled out $15 million in cash and bought $38 million worth of Uniqure stock, which together with previous purchases brought its stake in the Netherlands-based biotech to 9.9 percent.

Aerial photo of Coney Island Peninsula courtesy of a Creative Commons license via user Psychocadet.