A Thousand Oaks startup that is creating gene therapies aimed at permanently treating devastating diseases like Alzheimer's announced Thursday it received $140 million in capital.
Capsida Biotherapeutics is joining the gene therapy craze with small encapsulated viruses known as adeno-associated viruses, which can target specific cells in the body to treat diseases. The method is similar to the one used by pharma companies that create coronavirus vaccines.
Westlake Village BioPartners and Versant Ventures backed the Series A round with $50 million. Another $90 million came from pharma company AbbVie through a partnership.
Gene therapies aren't new — as a matter of fact, gene therapies have been heralded as a safer, more long-term solution to many diseases. Their approach is often try to replace or get rid of mutated genes that are causing harm to the body, or add genes to help the body fight diseases like Parkinson's or Huntington's.
"Unlike a pill that you take your once, twice a day, it's one treatment and you're done," said Robert Pacifici, chief scientific officer at a nonprofit Huntington's research organization called CHDI Foundation.
Several recent gene therapies have yet to break through. The FDA recently rejected the approval of BioMarin's gene therapy for hemophilia bleeding.
Others, like BlueBird Bio (which billed a promising sickle-cell gene therapy) and Ultragenyx (which was testing a gene therapy cure for Angelman syndrome) suspended clinical trials after patients had adverse effects.
There are often two problems to using gene therapy — targeted therapies don't always get to their destination, and, in large doses, often lead to negative effects, but in small doses, don't produce the desired results. It's a delicate balancing act for drug developers who need to be able to prove their therapy works without harming the body.
Capsida Biotherapeutics CEO Robert Cuddihy
(Courtesy of Capsida Biotherapeutics)
"There's a whole swath of areas that really haven't been amenable to any treatments," said Capsida CEO Robert Cuddihy. "I've always had an interest in the gene therapies and been following it for more than a decade, but it really wasn't ready for prime time."
Capsida uses — as its name would suggest — capsids, the outer coating of a viral particle that gets injected into the body. The capsid increases the particle's ability to hone in on a specific organ or cell, making targeting easier.
"The same amount of virus can actually do a whole lot more because it's much better getting into the cell," Cuddihy said. "It's much more effective. That then lets you decrease the dose," which lowers the risk profile of the virus.
The technology behind Capsida came from Caltech neuroscientists Viviana Gradinaru, who took existing capsids that could only transfer around 5% to 10% of the genetic material to the body and upped it to 70%, improving efficacy. She also engineered capsids to de-target the liver (which sucks in many gene therapies), making it easier for the body to send the capsid to the necessary cell.
Inside the capsid, where specific genes or therapies are located, the company will use AI and machine learning to help guide the development of gene therapies through the body and find its precise targets.
Capsida's partnership with AbbVie net the company $80 million in cash and $10 million in equity, with the potential of $530 million, as both companies make steps in targeting three specific diseases that deal with the central nervous system.
The technology could prove to be immensely useful for rare diseases like Huntington's, or prevalent, devastating diseases like Alzheimer's (though the company declined to mention which three diseases it would be targeting).
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Westlake Village BioPartners, the two-year-old venture capital firm founded by former Amgen executives and focused on bioscience startups named Peter Calveley its chief operating officer on Wednesday.
A former executive at health care industry investment bank SVB Leerink, Calveley will lead the firm's daily operational functions and guide the company's portfolio of young life science startups, many of which started in 2018 through strategic business decisions.
"Where we're really making our efforts are to find the best, most promising technologies which have the potential to be used to develop therapeutics for patients and matching with scientific and business talent to drive those promising technologies forward," Calveley said. "A substantial amount of my role is ensuring that those companies are financed optimally, as well, as we consider financing and strategic options for all of our companies."
Prior to joining Westlake, Calveley had his hand in a number of bioscience startups while at the bioscience-focused SVB Leerink investment bank. He saw many of them through in-licensing, acquisitions and even initial public offerings.
Last year, Westlake launched two funds worth $500 million. The largest of the two will invest in 12 Series A startups, with an eye toward Southern California companies. The rest of the funds will go toward Series B or later-stage startups.
Already, Westlake has invested in at least three new companies — a gene therapy startup in San Diego and two L.A. companies including ACELYRIN, a biopharma startup focused on immunology.
The firm opened a 130,000-square-foot campus outfitted with a lab in Thousand Oaks near Amgen for many of its younger startups to work out of. Co-founding Managing Director Sean Harper told the L.A. Venture podcast that he was particularly interested in seeding companies — usually with about $1 million — that it could incubate and take through successful rounds of funding.
"We don't do devices, or diagnostics or digital health. It's all about getting medicines to patients," he told the podcast.
The firm is taking advantage of Southern California's growing biotech community. According to a recent report from Biocom, the nonprofit tracking life science companies across California, L.A. County brought in over $1.1 billion in government funding in 2019 — the most of any county in California.
"The reason why I initially got into the biotech industry was it's an industry which is unique in the fact that it can have an unbelievable impact on young people's lives," Calveley said.
On this week's episode of LA Venture, hear from Sean Harper, founding managing director of Westlake Village BioPartners, which has two new funds totaling $500 million that's catalyzing the L.A. biotech ecosystem. Harper is the former head of research and development at biopharmaceutical company Amgen. He shares his focus on therapeutics to improve human lives and starting Westlake with Beth Seidenberg.
- Harper believes Google's AlphaFold and protein folding will be transformative, but doesn't want to overhype its potential.
- Harper points out that a lot of what's making biology more of a quantitative, predictive science and translatable into new therapies for people comes from the introduction of non-biology technologies like robotics, x-ray or crystallography.
- Westlake Village BioPartners has partnered with Alexandria Venture Investments which has helped to provide turnkey available laboratory space. This should help companies get set up quickly.
"At some point, it's going to be possible to essentially reset the immune system. So it no longer believes that self antigens are foreign. If somebody brings forward a technology like that, it'll be transformative." — Sean Harper
Sean Harper attended medical school at the University of California at San Francisco, completed internal medicine and gastroenterology training at Massachusetts General Hospital, and was a postdoctoral fellow in the laboratory of Nobel Laurette Phillip A. Sharp at the Massachusetts Institute of Technology. He held a number of key leadership positions at Amgen.
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