As Capital Market Grow Hopeful, Rare Disease Therapeutics Developers Raise $3 Billion in January

After a difficult 2023 for drug developers seeking to raise money, rare disease focused therapeutics companies began the new year with renewed hope as a bevy of public and private offerings reached almost $3 billion in January, according to data from Dealforma and Global Genes.

Rare disease public equity and debt funding in January rose 265 percent compared to the same period in 2023. Nine public companies with rare disease focused pipelines completed secondary offerings and PIPEs, raising a combined $2 billion in January in fresh equity.

BridgeBio added to this amount with a strategic debt financing of up to $1.25 billion to support an anticipated launch of acoramidis as the potential backbone of therapy for transthyretin amyloid cardiomyopathy, a buildup of faulty proteins on the heart that can cause heart failure.

Although there were no initial public offerings of rare disease focused biotechs in January, three therapeutics companies completed IPOs during the month.

Venture financing activity rose 15 percent for rare disease therapeutics companies year-to-date compared to the same period in 2023. Cour Pharmaceutical had the biggest financing of the month. Cour Pharmaceuticals, raising $105 million in a series A round.  The company is focused on disease modifying therapies designed to induce antigen-specific tolerance for immune-mediated diseases, with a clinical pipeline that includes product candidates in myasthenia gravis and type 1 diabetes, in addition to having partnered products in celiac disease (with Takeda Pharmaceuticals), and primary biliary cholangitis (with Ironwood Pharmaceuticals).

Total partnering deal values in January were also ahead of the same month in 2023, up 15 percent for rare disease focused deals. The year started with three potentially billion-dollar deals focused on genetic medicines.

Novartis entered into a strategic collaboration and capsid license agreement with Voyager Therapeutics to advance potential gene therapies for the rare neurological diseases Huntington’s disease and spinal muscular atrophy. Voyager will provide Novartis a target-exclusive license to access Voyager’s TRACER capsids and other intellectual property for the respective diseases, and Voyager and Novartis will collaborate to advance a preclinical gene therapy candidate for Huntington’s disease.

Novartis is paying Voyager $100 million up front, including a $20 million of newly issued equity in Voyager. Voyager is eligible to receive up to $1.2 billion in preclinical, development, regulatory and sales milestones, as well as tiered royalties on global net sales of products incorporating Voyager’s TRACER capsids. Novartis will obtain target-exclusive access to Voyager’s TRACER capsids related to SMA and will be responsible for all development and commercialization, and worldwide rights to Voyager’s AAV gene therapy for HD, leveraging Voyager’s TRACER capsids and proprietary payloads. Voyager will be responsible for preclinical advancement and Novartis will be responsible for all clinical development and commercialization for the HD program.

Roche entered back-to-back deals with Remix Therapeutics and Moma Therapeutics to access their technologies. Remix, which is developing small molecule therapies to modulate RNA processing and address underlying drivers of disease, entered a collaboration and license agreement with Roche for the discovery and development of small molecule therapeutics that modulate RNA processing using Remix’s REMaster drug discovery platform.

Remix will receive $30 million upfront and is eligible to receive up to $12 million in near-term milestone payments, as well as preclinical, clinical, commercial and sales milestones of up to $1 billion, and tiered royalties. In exchange, Roche will have exclusive rights to specific targets. Remix will conduct discovery and preclinical activities with Roche, and Roche will be responsible for development and commercialization of any resulting products.

The strategic collaboration and licensing agreement with Moma Therapeutics gives Roche access to Moma’s proprietary KnowledgeBase platform for the identification and pursuit of a number of novel drug targets involved in promoting cancer cell growth and survival. Roche will pay Moma $66 million payment of $66 million and up to $2 billion in discovery, development, and commercialization milestone, as well as tiered royalties. Moma will be primarily responsible for all activities for selected targets through to development candidate confirmation. Roche will be responsible for IND-enabling activities and clinical development and commercialization.

The only area in which January 2024 did not best activity for the same period a year ago was rare disease focused M&A as it dropped 22 percent. Sanofi’s acquisition of Inhibrx for up to $2 billion to gain a potential best-in-class treatment for the rare disease alpha-1 antitrypsin deficiency, following the spinoff of all other assets, was the major M&A deal of the month. Under the terms of their agreement, Sanofi will acquire all outstanding shares of Inhibrx for $30.0 per share in cash, representing an equity value of approximately $1.7 billion. Inhibrx’s shareholders will also receive one non-transferable CVR per Inhibrx share, which will entitle its holder to receive a deferred cash payment of $5.0, or another $296 million for Inhibrx’s shareholders.