Seattle-based Athira Pharma closed on a Series B financing worth $85 million. The round was led by Perceptive Advisors with participation from new investors RTW Investments, Viking Global Investors, Venrock Healthcare Capital Partners, Franklin Templeton, Rock Springs Capital, LifeSci Venture Partners, Surveyor Capital (a Citadel company), Highside Capital Management, Logos Capital, funds managed by Janus Henderson Investors, Sofinnova Investments, Avidity Partners, and existing investors including Rick and Suzanne Kayne and Sahsen Ventures.
The company plans to use the money to advance its lead candidate, NDX-1017, into Phase II/III clinical trials. In December 2019, the company presented positive data from its Phase Ia/b trials of the drug in 88 healthy subjects and patients with Alzheimer’s disease. The trial evaluated quantitative electroencephalography (qEEG) as a biomarker of brain circuitry activity and an event-related potential (ERP) as a way to test working memory and cognitive processes. The drug showed dose-dependent and consistent changes in brain activity in all patients treated.
NDX-1017 is a small molecule designed to improve the activity of Hepatocyte Growth Factor (HGF) and its receptor, MET, which are expressed in normal central nervous system function. The company believes the drug has the potential to be regenerative, possibly slowing, halting or reversing the effects of Alzheimer’s disease.
Leen Kawa, president and chief executive officer of Athira, said of the financing, “We are dedicated to impacting the course of neurodegenerative diseases and are eager to advance our lead therapeutic candidate, NDX-1017, into Phase II/III clinical development following the encouraging data we presented at CTAD, showing a rapid and statistically significant improvement in an objective measure of cognitive process in Alzheimer’s patients. We appreciate the support from this prominent group of investors, which will also enable us to explore the potential of our pipeline of compounds across a range of central and peripheral neurodegenerative and neuropsychiatric indications.”
As part of the financing, Joseph Edelman, chief executive officer and Portfolio Manager of Perceptive Advisors, is joining Athira’s board of directors.
“NDX-1017 represents a novel mechanism for treating Alzheimer’s patients and we are very excited to invest in Athira,” Edelman said. “Athira has assembled an impressive and seasoned management team with years of CNS drug development experience, and we look forward to supporting an innovative company focused on devastating neurological diseases.”
Not surprisingly, the company faced some hurdles in raising funds in the midst of the COVID-19 pandemic, when more focus was on infectious diseases.
“We had to be realistic that we’d be experiencing some slowing down and give investors time to digest what’s happening,” Kawas told The Seattle Times. “But I would say that just by having patience in this unusual type of environment and also respecting what the investors are going through—along with our story, the work and the huge medical need—is what helped get us through the finish line.”
Athira previously raised $12 million ahead the clinical testing, which brought the total since inception up to $14 million. The new funds raised, in addition to heading into Phase II/II trials probably late next year, will be used to double its staff, which currently has 17 employees. It will also use the money to deepen its pipeline.
“What was good for us here was that we had a really good story,” Kawas told The Seattle Times. “We had fantastic data and a huge medical need—Alzheimer’s patients. It was very obvious that despite the macro environment changes, there is still a huge medical need in Alzheimer’s, and the intrinsic value of the work that we’re doing was still there.”