Swiss pharma giant Novartis has invested $75 million in a $142 million Series C round for San Diego-based Poseida, which is one of several companies developing what is meant to be a one-time, long-lasting treatment for multiple myeloma. Poseida plans to begin administering its experimental treatment P-BCMA-101 to patients in a Phase 2 study later this year.
Multiple myeloma affects about 300,000 Americans every year. While the prognosis for patients has improved significantly over the past decade, most everyone relapses. That means despite the availability of newer drugs and combinations that can put patients into remission for longer periods of time, opportunities still remain for drugmakers to work their way into the treatment paradigm.
One of the newest, emerging weapons in the fight is CAR-T, a cutting-edge form of cell therapy. Poseida is one of several companies trying to develop CAR-T therapies meant to seek out cancer cells with the protein BCMA on their surface and wipe them out. The results so far, in patients who have failed several treatments, have been promising. And as a result, the race to develop a BCMA CAR-T has become very competitive. Cambridge, MA-based Bluebird Bio (NASDAQ: BLUE) leads the pack, but Nanjing Legend Biotech, Poseida, and others are also in the mix, as Xconomy detailed in December. Bluebird could be first to market and aims to file for approval of its myeloma CAR-T bb2121 next year.
Novartis has already been invested in the race through an alliance with the University of Pennsylvania. That collaboration is ongoing: A team at the Novartis Institutes for BioMedical Research is working with Penn on internal CAR-T programs, a company spokesperson said.
Now the Swiss company—which already owns one of the only two FDA-approved CAR-T therapies, Kymriah—is placing another bet by cozying up to Poseida.
Poseida is enrolling multiple myeloma patients who have failed multiple therapies into a Phase 2 trial in which patients will be followed on an outpatient basis, rather than in the hospital, following the treatment.
That’s important: Patients who get CAR-T treatment today are monitored closely in hospitals because of some of their potentially deadly side effects, among them a wayward immune attack called cytokine release syndrome (CRS). But Poseida says its method of modifying patients’ immune cells may help people avoid those side effects. Results from its ongoing Phase 1 test indicate the drug may be less toxic than other CAR-T therapies, the company says.
In an SEC filing, Poseida said 15 of 23 evaluable patients in the Phase 1 trial saw “meaningful responses” to P-BCMA-101 as of Jan. 31. Five “mild and transient” cases of CRS were reported, and one patient had a neurological side effect—another common occurrence with CAR-T therapies so far—though that also wasn’t considered serious. Poseida said that none of the serious side effects seen in clinical testing so far were drug-related. And the company hasn’t seen anything that would stop it from testing a higher dose. Poseida also hasn’t yet reported how long the CAR-T’s effects have lasted in patients who have responded to treatment. Several patients in the Phase 1 study have only recently gotten P-BCMA-101, the SEC filing says.
The company also has three preclinical CAR-T assets that it aims to bring to human testing in 2019 and 2020. Two are meant for solid tumors; another is meant to be an “off-the-shelf” treatment for multiple myeloma that is harvested from the cells of anonymous donors. All the CAR-T’s in human testing for multiple myeloma are “autologous” therapies that are tailored to each specific patient.
For Poseida, the round represents a strategic shift. Last year, in April, the company announced it had raised a $30.5 million Series B round led by Longitude Capital. CEO Eric Ostertag said Poseida considered raising another financing round in late 2018, but decided, as the financial markets got choppy near year’s end, to instead go straight to the public market. It filed for an initial public offering in January.
But the U.S government partially shut down shortly after Poseida filed, throwing its plans into disarray. The company re-filed its paperwork in March with updated financials and data and aimed to raise $115 million, but ended up taking another round of private financing instead. On the day the $142 million round was announced, the company withdrew its IPO filing. [Updated to reflect the status of Poseida’s IPO filing.]
“Novartis came to us and said, what do you think about, essentially, a no-strings-attached investment, which you could then piggyback other additional investors on and [have] serve as sort of a crossover round?” Ostertag said. “That ended up being exactly what happened. They got a ringside seat, i.e. a board position, but otherwise no real strings attached.”
Poseida, with about 75 employees today, will likely see its headcount top 100 by year’s end, Ostertag said.
He founded the company in 2014 as spinout of Transposagen Biopharmaceuticals, a gene editing company he had started in Philadelphia, which was subsequently acquired by Lonza, a Swiss drug manufacturer.
New investors Aisling Capital, Pentwater Capital, and Perceptive Advisors contributed to Poseida’s round along with Novartis. Previous Poseida backers including Longitude, Malin, Vivo Capital, and the Tavistock Group’s Boxer Capital also invested, according to the company.