After spending the past six years scavenging for lab equipment and operating on a shoestring, San Diego’s Crinetics Pharmaceuticals has finally landed its first round of institutional funding.
The startup, which is developing new oral drugs for treating an array of endocrine disorders, said today it has raised a $40 million Series A financing led by 5AM Ventures, Versant Ventures, and Vivo Capital.
Crinetics plans to use the proceeds mostly to advance its lead drug candidate, a small molecule agonist targeting the receptor for somatostatin, a regulatory hormone that inhibits the secretion of growth hormone. Crinetics wants to carry out clinical proof-of-concept trials of the drug as a new treatment for neuroendocrine tumors and acromegaly, a rare disorder caused by excess growth hormone production that affects at least 20,000 people in the United States.
According to the company, current treatments for acromegaly and neuroendocrine tumors involve injectable peptide-based treatments, and generated over $2 billion in worldwide sales last year.
Crinetics CEO Scott Struthers, who previously headed endocrinology and metabolism R&D at San Diego’s Neurocrine Biosciences (NASDAQ: NBIX), set out in 2008 to pursue his own ideas regarding G protein-coupled receptors. In a phone call late Friday, Struthers said acromegaly is caused by a benign tumor of the pituitary gland.
Former Neurocrine colleagues Frank Zhu and Steve Betz joined Struthers in 2009 after Neurocrine cut half of its 120 employees. The biotech had decided to focus on elagolix, its lead drug candidate for treating endometriosis, an abnormal and painful excess growth of uterine tissue. Struthers said another former Neurocrine colleague, Anna Kusnetzow, also joined Crinetics at that time, and the four co-founders opened the startup’s first laboratory in January 2010.
“I’ve been working with my co-founders since 1998 at different companies,” said Struthers, who completed his doctorate studies at The Salk Institute under the late Wiley Vale and Roger Guillemin. “Our work on somatostatins is all homegrown. We built it with our own money and grant money from the NIH and elsewhere.”
Struthers told me earlier this year that Crinetics had raised at least $6.4 million in nondilutive funding over the past five years, with $4.7 million generated from Small Business Innovation Research Grants. The remaining $1.7 million came from consulting and research grants from the Found Animals Foundation, a Los Angeles nonprofit foundation.
Today Crinetics has 12 employees, and is looking to substantially expand its drug development work, Struthers said.
Crinetics has appointed Wendell Wierenga, a former executive vice president at Neurocrine Biosciences, as board chairman. Mason Freeman of 5AM Ventures, Steve Kaldor of Versant Ventures and Mahendra Shah of Vivo Capital also joined the board.