A Chicago biotech skips the IPO in favor of late-stage Series D for a PhIII Tourette drug

Emalex Biosciences has secured $250 million in Series D funds to bankroll a Phase III clinical trial in children, adolescents and adults who have Tourette syndrome.

The Chicago biotech plans to kick off the trial this quarter and will target 90 sites across the US, Canada and Europe with a 220-patient trial, which the four-year-old drug developer claims would be the largest transatlantic trial ever for the central nervous system disorder, chief business officer Eric Messner told Endpoints News.

Pumping capital into the business are: Series D leader Bain Capital Life Sciences, Valor Equity Partners, Fidelity Management and undisclosed family offices.

The trial will take about two years, which means data should come out in early 2025 for a potential FDA drug approval request, Messner said. The hefty late-stage private financing announced Thursday will take Emalex all the way there, the executive added, with enough to bankroll manufacturing, clinical pharmacology studies and certain pre-commercialization activities, should the Phase III bear fruit.

Drug R&D for Tourette syndrome has not been easy, with clinical setbacks at Neurocrine, Teva and others. But some are trying to move forward, like Noema Pharma, which is in mid-stage testing for a former Roche asset.

“Tourette’s is a disease of high unmet need. In the last few years, there have been attempts by other industry leaders like Neurocrine Biosciences with their VMAT2 inhibitor, but unfortunately those trials were not successful,” Bain managing director Ricky Sun, who led the firm’s investment in Emalex, said in an email to Endpoints. “We believe Emalex’s lead molecule has the right properties to be a highly attractive option for patients.”

Emalex will test the same primary efficacy endpoint as it did in a Phase IIb study of ecopipam, or EBS-101, focused on children under the age of 18. The D1AMOND Study tested whether 2mg/kg/day of the drug was better than placebo on a scale known as the Yale Tic Severity Score-Total Tic Score in a randomized withdrawal trial.

The 153-patient study found that the drug was statistically significant and clinical meaningful “at all timepoints, from Week 4 to Week 12,” the company said last November. Headache, fatigue, somnolence, insomnia and restlessness were reported side effects.

The dopamine-1 receptor antagonist was acquired from Maryland-based Psyadon in 2018. The original owner had tested it in a Phase IIb, with results posted in 2017. The drug might also be tested in patients with restless legs syndrome with augmentation, also known as Willis-Ekbom disease, after a licensing agreement was inked with East Carolina University last spring.

Messner said the company explored multiple financing avenues between the $35 million Series C in March 2021 and the Series D, which came together after discussions with Bain over the past few months. That included looking at a potential debut on Wall Street, the executive said.

Castle Creek Biosciences, another biotech out of the incubator Paragon Biosciences, had also considered an IPO, but a little bit more seriously, having filed paperwork with the SEC but ultimately backing out in late December 2021, instead opting for a $112 million raise in the first half of 2022.

Jeff Aronin

Paragon leader Jeff Aronin and Messner co-founded Emalex in 2018. The two worked together on Marathon Pharmaceuticals, a Martin Shkreli-like price-hike biotech that took a cheap overseas steroid, got it approved by the FDA for Duchenne muscular dystrophy in February 2017, and received pushback from politicians and others about the $89,000 list price.

At the time, Messner was VP of sales and marketing. PTC Therapeutics bought the drug, marketed as Emflaza.

Chicago-based Paragon has also backed daytime sleepiness drugmaker Harmony Biosciences, Takeda-partnered Evozyne and eye-focused cell therapy maker CiRC Biosciences.

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