In Quest to Drug RNA With Small Molecules, Expansion Pulls In $55M

Xconomy San Diego — 

Drug developers have long thought that targeting RNA with small molecule drugs was too difficult, but new insight into RNA biology is starting to change their minds. In the latest sign of this growing interest, a new startup, Expansion Therapeutics, today announced a $55.3 million Series A investment round. The financing will fund the development of chemical-based drugs for a group of genetic diseases that are caused by dysfunctional RNAs with a specific kind of mutation.

Using small molecules to alter the activity of RNA—which carry the genetic instructions for proteins to the cell’s protein-making machinery—potentially opens up a whole new class of largely untapped drug targets, and could offer a way to treat diseases that can’t be treated with traditional protein-binding drugs. The goal of Expansion, based in San Diego, CA, and Jupiter, FL, is to use chemical compounds to change the function of disease-driving RNA molecules and address the root cause of disease.

RNA molecules, however, have been tricky to drug, in part because people have thought that RNAs didn’t have the right kind of chemical structures that could be bound by a diverse range of small molecule drugs.

But with a deeper understanding of the structure of RNA molecules and better technologies to sequence and make a lot of RNA molecules at relatively low cost, more drug developers now see a real possibility of going after RNA with small molecules. Other kinds of drugs, like RNA interference (RNAi) ones, already target RNA, but RNAi treatments have been difficult to deliver to a variety of tissues. The hope is that small molecule drugs would sidestep those delivery challenges.

A lot of this new biological insight into the druggability of RNA has come from the lab of Expansion’s scientific founder, Matthew Disney, a chemist at the Scripps Research Institute in Jupiter. In a 2016 paper in Nature Chemical Biology, Disney and his group showed that small molecules they designed could bind to a specific folded section of a mutant RNA molecule that causes myotonic dystrophy type 1 (DM1), the most common form of adult onset muscular dystrophy. The paper lays out the foundational technology for the company, and showed that from a venture perspective, “this was ready for prime time,” says Kevin Forrest, Expansion co-founder who was named the company’s president and CEO as part of today’s announcement.

DM1 is in fact the first disease that Expansion is going after, and the company already has compounds that Disney says can restore the function of the RNA involved in DM1. Expansion is setting its sights more broadly on the group of genetic diseases that DM1 belongs to, called expansion repeat disorders. These diseases, roughly 30 of them, are caused by RNAs that have certain repeated sequences. The company is also pursuing a program in myotonic dystrophy type 2, a milder form of DM1.

Expansion’s technology is based on many years of research from Disney’s lab. He and his group have identified key folded RNA structures that small molecules can bind to. They developed two large chemical libraries: one containing thousands of different folded RNA structures and the other with thousands of chemical compounds that can bind to such RNA folds. Disney’s group built tools that allow the scientists to rapidly sift through millions of combinations of compounds and RNA folds from those libraries, and home in on those combinations where the compounds bind tightly and only in specific sections of the RNA. “I was just blown away by the breadth and depth of what’s been done in the [Disney] lab,” says Forrest, who left as chief operating officer and chief financial officer of San Diego-based Cidara Therapeutics to help launch Expansion.

Expansion now joins Arrakis Therapeutics of Waltham, MA, in the race to find a pill for RNA. Arrakis, headed by veteran biotech leader Michael Gilman, snagged $38 million in Series A funding early last year. In December, it announced that it licensed technology from the University of Pennsylvania, allowing the company to use small molecules to target specific structures in folded RNA called three-way junctions.

Expansion’s Series A financing was co-led by 5AM Ventures (which incubated the firm), Kleiner Perkins Caufield & Byers, Novartis Venture Fund, and Sanofi Ventures, with participation from RA Capital Management and Alexandria Venture Investments.