Kate Therapeutics, Inc.

As it works to rebuild from an earlier gene therapy setback, Astellas is doubling down on the one-and-done modality in a new deal with a London-based startup already in the clinic. Astellas said Tuesday it will pay $30 million upfront and invest $20 million in AviadoBio in exchange for the chance to exclusively develop and commercialize the startup’s AAV-based gene therapy for people with frontotemporal dementia with progranulin mutations, or FTD-GRN. Investigators dosed the first patient with the experimental medicine, codenamed AVB-101, in April. The Phase 1/2 also opened in the US in July. Astellas could deliver up to $2.18 billion in license fees and milestone payments, the companies said. Astellas could develop AVB-101 for FTD-GRN and potentially other indications, the duo added. AviadoBio mentions ALS as another focus area for the startup, according to its website. Patients with FTD, an early form of dementia, can die within three to 13 years after diagnosis, the companies said. Attention, memory, mobility, problem solving and other functions deteriorate in adults with the neurodegenerative disease. AviadoBio’s gene therapy delivers a working copy of the GRN gene into the brain with the goal of halting the disease’s progress. The Astellas investment provides a boost to AviadoBio, which does not appear to have raised another financing round since unveiling an $80 million Series A in December 2021. Leading the upstart is former Novartis Gene Therapies chief business officer Lisa Deschamps. “Together, we can further accelerate delivering this investigational medicine to families around the world who so desperately need treatment options for FTD-GRN and other neurological diseases,” Deschamps said in a press release, noting the company is completing dosing in the first cohort of the ASPIRE-FTD study. The AviadoBio tie-up marks a further bet on gene therapy for Astellas, which ran into a major setback in 2020 and 2021, when four boys died after receiving the company’s gene therapy for a rare neuromuscular disease known as X-linked myotubular myopathy. “People tend to look at the four boys’ deaths. And that’s a very unfortunate and tragic situation,” Astellas CEO Naoki Okamura told Endpoints last month . “On the other hand, there are healthier boys who received [the therapy] and survived for three to five years already. So we believe in the power of gene therapy to really make the difference.” Astellas is working with Kate Therapeutics to improve the safety of the Audentes gene therapy, which is known as resamirigene bilparvovec, or AT132. The drugmaker also has Phase 1-stage gene therapies for Pompe disease (zocaglusagene nuzaparvovec, or AT845) and ASP2016 for cardiomyopathy associated with Friedreich’s ataxia. It also took a write-down in April on a preclinical Friedreich’s ataxia gene therapy known as AT808 from the Audentes buyout. Meanwhile, multiple drugmakers are pulling back from gene therapy R&D, including Pfizer, while a small number of startups have been able to reel in large financing rounds to carry forward their work in the field. The Japanese pharmaceutical company has a gene therapy R&D and manufacturing footprint in the Bay Area; Sanford, NC; and Tsukuba, Japan.

Astellas Pharma is spreading its bets in neurodegenerative disorders, committing $50 million to AviadoBio for the opportunity to license its lead program, an experimental gene therapy for a type of dementia with no FDA-approved drugs. The sum breaks down to a $20 million equity investment and up to $30 million in upfront payments. The deal announced Tuesday grants Astellas an exclusive option to license global rights to the London-based startup’s AVB-101, which is currently in early clinical development as a potential treatment for a certain form of frontotemporal dementia (FTD). FTD is a type of early-onset dementia that leads to rapid decline in functions such as attention control, working memory, and problem solving. It typically causes death within three to 13 years of diagnosis, according to AviadoBio. The company aims to specifically treat this dementia when it is driven by a mutation to the gene that encodes progranulin (PGN), a protein that regulates immune activity in the brain. presented by Health IT Accelerating Claim Processing: Strategies to Shorten the Life of a Claim These strategies and practices can significantly shorten the life cycle of claims, leading to quicker resolutions and improved financial outcomes. By Greenway Health AVB-101 delivers to the central nervous system a functioning copy of the gene that provides instructions for making progranulin. The goal of the one-time treatment is to bring levels of that protein into the range of normal. Administered into the thalamus of the brain, AviadoBio’s therapy is transported to its cellular targets aboard an adeno-associated virus (AAV), an engineered virus widely as a delivery vehicle for genetic medicines. AviadoBio’s science is based on research from King’s College London. The startup emerged from stealth in 2021, backed by $80 million in Series A financing. In preclinical research conducted with progranulin-deficient mice, AviadoBio has reported its experimental FTD-PGN therapy led to expression of progranulin in the brain and a reduction in disease pathology. A Phase 1/2 ascending-dose clinical trial treated its first patient earlier this year. The open-label study has a targeted enrollment of nine participants. There are other efforts underway to try and restore progranulin levels as a way to treat FTD-PGN. Passage Bio’s PBFT02 is a gene therapy intended to boost levels of the key protein in the central nervous system. This program has reached Phase 1/2 testing. Alector is taking a different approach with AL100, an antibody drug designed to bind to a protein that leads to degradation of progranulin. This program has reached Phase 3 testing under a partnership with GSK, which has rights to share in the development and commercialization of this experimental therapy. Gene therapy is one of the areas Astellas has identified for growth, Richard Wilson, the company’s senior vice president for genetic regulation, told MedCity News last year. Within gene therapy, the company is focusing on neuromuscular disorders, central nervous system conditions, and ophthalmology. Astellas’s gene therapy division formed from the 2020 acquisition of Audentes Therapeutics, which brought a pipeline of gene therapies in various stages of development for rare inherited disorders. presented by Health Tech What’s Keeping Healthcare CIOs Up at Night: How to Improve Patient Satisfaction by Handling Calls More Efficiently Health systems have spent billions on portals while investments in modernizing the voice channel — the dominant preference of healthcare consumers — have taken a backseat. By Stephanie Baum Some of the Audentes programs have encountered setbacks. The FDA in 2021 placed a clinical hold on an experimental gene therapy for the enzyme deficiency Pompe disease. That hold was lifted in early 2023. Three gene therapy programs for Duchenne muscular dystrophy were terminated in 2022 based on preclinical data. A gene therapy for the rare neuromuscular disorder X-linked myotubular myopathy was placed under a clinical hold in 2020 following three patient deaths. Though it later was cleared to resume, a fourth patient death in 2021 led to another clinical hold that is still in place. Astellas has prior experience with option deals for gene therapies. Two years ago, Astellas made an equity investment in Taysha Gene Therapies, securing exclusive options to license gene therapies for the rare neurodegenerative disorders giant axonal neuropathy (GAN) and Rett syndrome. Following the report of Phase 1/2 data for the GAN gene therapy last year, Astellas said it would not exercise its option on that program. A key Rett study is ongoing and the option for this program remains open. Astellas has struck other deals to fill its gene therapy pipeline. Last year, the company licensed a preclinical Kate Therapeutics gene therapy in development for X-linked myotubular myopathy. Following that deal, Astellas licensed the rights to use a 4D Molecular Therapeutics AAV vector for ophthalmic diseases. The option agreement with AviadoBio covers the application of AVB-101 to FTD-GRN and other indications. The trigger for the option and the option exercise period were not disclosed. But if Astellas exercises it, AviadoBio could receive up to $2.18 billion in license fees and milestone payments, plus royalties from sales of a commercialized product. “As we complete dosing of the first cohort of patients in our Phase 1/2 ASPIRE-FTD trial of AVB-101, we are excited about the potential of this collaboration to help address the unmet need that exists today in frontotemporal dementia,” AviadoBio CEO Lisa Deschamps said in a prepared statement. “This strategic collaboration will combine our promising gene therapy candidate for FTD-GRN and delivery expertise with Astellas’s global capabilities in development and commercialization of gene therapies.” Public domain image by Flickr user SciTechTrend

CAMBRIDGE, MA — When looking to the future of the drug industry, the allure of Boston is strong. This week, the Japanese drugmaker Astellas became the latest company to open a research hub in the region, following Eli Lilly , Novo Nordisk and other companies that recently set up similar outposts. “Innovation is our lifeline, and we need to have a footprint here,” Astellas CEO Naoki Okamura told Endpoints News in an interview after a sake barrel-breaking ceremony to celebrate the opening of the company’s new 62,000 square-foot research center in Cambridge, MA. The 400-person center, which will also house some business development and commercial teams, is Astellas’ long-term investment in a future beyond Xtandi , the prostate cancer drug it developed with Pfizer that brought in more than $5 billion in revenue last year. Sales continued to grow in the second quarter, but key patents for the treatment are set to expire over the next three years. In a wide-ranging interview, Okamura discussed the company’s post-Xtandi plans, its M&A strategy, its new focus on protein degraders, its longstanding commitment to cell and gene therapy, and the importance of planting roots in Boston. “This center is going to be a critical key success factor,” he said. In the near-term, Okamura said that Astellas needs to boost sales of five other drugs, including Veozah , a pill for treating hot flashes during menopause; Izervay , an eye injection for a form of vision loss called geographic atrophy; and three cancer drugs named Padcev, Xospata and Vyloy. The latter drug is approved in Japan and currently under review at the FDA, with a decision expected in November. But those five key drugs accounted for just $1.1 billion in sales in 2023, less than 10% of the company’s total revenue. Sales of both Veozah and Izervay have been sluggish. Reaching the company’s profit margin target will require getting some of those drugs approved for additional diseases and running a “leaner organization,” Okamura said. “The strong growth of these five strategic brands is the must,” he said. “But that doesn’t guarantee sustainable growth.” The Cambridge research site will help fill the company’s early-stage pipeline. It has a big emphasis on developing protein degraders and other small molecules that act as molecular matchmakers. Astellas’ efforts were spearheaded by its own scientists who were itching to work on the molecules, which promise to tackle many notoriously tough-to-drug proteins. Just a few years after greenlighting the program, Astellas has already made a degrader for KRAS G12D, a mutant protein common in pancreatic, lung and colorectal cancers. It plans to disclose the first glimpse of data from the Phase 1 study at ESMO, a European cancer conference, this month. “This is just a start,” chief medical officer Tadaaki Taniguchi told Endpoints. Astellas has several other protein degraders in the works, including a pan-KRAS degrader and undisclosed programs for cancer and non-cancer targets, he added. But the homegrown molecule may be an outlier in the company’s future pipeline. Astellas got most of its approved drugs, and many of its experimental ones, from other companies, and Okamura expects that trend will continue. “We kind of stopped thinking that internally-developed product is the best product,” Okamura said. “Going forward, there would be very few, if any, compounds that we say that this is our internally-discovered, developed product.” The company has been striking partnerships with smaller biotechs and academic centers, many focused on cell and gene therapies. In January, the company announced a five-year collaboration with Mass General Brigham in Boston, although details about that partnership are sparse. Astellas is also opening its first US-based SakuLab, a rentable lab space and biotech incubator. Several other pharma companies in Boston have similar setups at their research centers, giving them a front-row seat to some of the newest ideas in the industry. “We also need to continue to show our presence, that we are here and are open to collaborate,” Taniguchi said. These efforts are small compared to its $5.9 billion acquisition Iveric Bio and its eye drug Izervay last summer. It was the company’s largest acquisition ever. And while Okamura said Astellas will remain “opportunistic,” another Iveric-sized purchase isn’t happening anytime soon. “We had been watching the compound for more than eight years until we made the final decision to acquire,” Okamura said. “Six billion dollars is somewhat the limit for our financial capacity. So if you ask me, are you going to do a similar size M&A in three years? I don’t think so.” The Iveric acquisition also meshed with the company’s longstanding ambitions to create regenerative medicines for vision loss, and it gave Astellas a foothold in the ophthalmology market. Astellas is currently testing a stem cell-derived therapy in people with geographic atrophy. If it works, it could restore eyesight instead of simply slowing vision loss like Izervay. The Phase 1 study is expected to wrap up in January 2026. “Izervay is going to be a front-runner for our follow-on products,” Okamura said. At a time when many pharma companies are abandoning gene therapy programs, especially for rare diseases, Astellas insists that it has no plans to give up on the medicines, even in the face of one of the industry’s most tragic failures. Four boys died after receiving the company’s gene therapy for a rare neuromuscular disease in 2020 and 2021, likely due to liver failure from the high doses of virus used to shuttle the therapeutic gene. But Astellas still wants to find a way to use that gene therapy, and others, more safely. “People tend to look at the four boys’ deaths. And that’s a very unfortunate and tragic situation,” Okamura said. “On the other hand, there are healthier boys who received [the therapy] and survived for three to five years already. So we believe in the power of gene therapy to really make the difference.” Okamura believes Astellas has an obligation to improve the safety of the treatment. It is working with startup Kate Therapeutics on a new version of the therapy that the company hopes is better at targeting muscle cells and avoiding the liver. “We know that the correct transgene to the targeted cell should cure the situation,” Okamura said. “And we have no intention to give up.”