CinCor’s ‘hub-and-spoke’ parent nabs new funding to build its next biotechs

2024-05-30

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Dive Brief:

CinRx Pharma on Thursday raised a $73 million funding round to help build a portfolio of lean drug startups.

Since its formation in 2015, the Ohio-based firm has launched a handful of biotechnology companies advancing drugs for cardiovascular, metabolic and gastrointestinal diseases. One of them, blood pressure drugmaker CinCor Pharma, went public and in 2023 was acquired by AstraZeneca for $1.3 billion.

The new financing, from unspecified “industry insiders” and “high-net-worth individuals,” will support the rest of CinRx’s portfolio, which includes an obesity startup with multiple drug programs. CinRx has now raised a total of $176 million. It’s also invested in biotechs VTV Therapeutics and Retromer Therapeutics.

Dive Insight:

CinRx is one of many “hub-and-spoke” biotechs, which discover or acquire promising drug prospects and house them in individual subsidiary companies.

Though unconventional, the approach has drawn increased investment in recent years and led to a number of large deals and initial public offerings. Hub-and-spoke biotech PureTech Health, for instance, saw offshoot Karuna Therapeutics get acquired for $14 billion. Roivant Sciences sold subsidiary Telavant for $7 billion. Paragon Therapeutics has taken three companies public, led by Apogee Therapeutics, the top performing IPO since the start of 2023, BioPharma Dive data show. Nimbus Therapeutics inked a $4 billion deal with Takeda, too.

One of the key advantages of the hub-and-spoke model, according to CinRx CEO Jon Isaacsohn, is its “financial efficiency.” CinRx can share resources across its portfolio in ways traditional biotechs can’t. That’s especially valuable in the early stages of clinical development, “when a full-time, dedicated team is not required,” he wrote in an email to BioPharma Dive.

“Given the high rate of discontinuation for early-stage programs, this model allows for lower operating costs and offers multiple opportunities for success,” Isaacsohn wrote.

CinRx already has a measure of validation for its work in CinCor, which was formed around a drug licensed from Roche in 2019. CinCor brought the medicine into advanced testing for a type of stubbornly high blood pressure, raised $194 million in an IPO in 2022 and was acquired by AstraZeneca a year later.

Now the firm is working on its next acts. One, called CinFina Pharma, is developing four obesity drug prospects licensed from Johnson & Johnson. A Phase 1 trial for one of those drugs began in March, while a second therapy is headed for mid-stage testing.

Another startup, CinDome Pharma, has a drug for gastroparesis that’s in mid-stage testing and recently added $40 million in new funding. CinPhloro Pharma also has a medicine in Phase 2 trial for irritable bowel syndrome.

CinRx will use the cash to get those companies to “important value inflection points” and acquire other assets to build new companies around, according to Isaacsohn.

The company has identified multiple assets “that have the potential to address major, unmet needs” in immunology and nephrology, and is exploring potential deals in cardiology too.

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