Apogee Therapeutics’ lead drug candidate has new mid-stage data indicating it could be competitive with currently available biologic medicines for atopic dermatitis, but with less frequent injections. Now the biotech has secured up to $1.3 billion to finance a pivotal clinical trial in this prevalent inflammatory skin disorder and even look ahead to a product launch.
The cash isn’t coming all at once. The deal with Blackstone Life Sciences announced Wednesday is a royalty financing tied to the clinical progress of the drug, zumilokibart, as well as its future sales if it reaches the market. But Apogee said this agreement means it will have enough cash to support potential commercialization of zumilokibart without needing a future equity financing.
The biologic drugs available for atopic dermatitis, also called eczema, are monoclonal antibodies designed to block targets associated with inflammation. One of the primary drivers of atopic dermatitis is a signaling protein called IL-13. The Sanofi and Regeneron Pharmaceuticals product Dupixent counteracts inflammation by blocking both IL-13 and another protein, IL-4. The available IL-13-blocking atopic dermatitis drugs are LEO Pharma’s Adbry and Ebglyss from Eli Lilly. Galderma drug Nemluvio blocks a different target called IL-31. These medicines are administered by injection every two to four weeks.
Apogee’s zumilokibart also blocks IL-13, but with a dosing edge. This drug is a long-acting antibody. In a 52-week Phase 2 test of the drug as a maintenance therapy, results showed deep clinical responses that were maintained with dosing at three- and six-month intervals. On Wednesday, Apogee released results for the 16-week induction phase, the initial treatment period when higher doses are used to get disease symptoms under control. Apogee reported that zumilokibart met primary and secondary goals with high statistical significance. Furthermore, the study drug was well tolerated and showed a safety profile consistent with other IL-13-blocking drugs.
Of the three doses tested in Phase 2, Apogee said the low and middle doses showed similar effect while the low dose showed relatively lower clinical activity as expected. The company has selected the middle dose to advance to Phase 3 testing in moderate-to-severe atopic dermatitis. The study is expected to begin in the second half of this year.
“If approved, this could be the first product in any dermatological indication to offer the option for every three- and six-month dosing,” CEO Michael Henderson said during a Wednesday morning conference call. “With today’s data and the bespoke capital facility provided by Blackstone, we believe Apogee has a path to commercialization and profitability.”
Before the Blackstone deal, Apogee said it had about $1.3 billion in cash. The new financing breaks down to $400 million before zumilokibart’s regulatory approval — $100 million upon signing the deal, $100 million upon completion of Phase 3 enrollment, and then $200 million if the study yields positive Phase 3 data. If the FDA approves zumilokibart, Apogee would receive up to $400 million in additional funding from Blackstone. In exchange, Blackstone will receive a synthetic royalty, a percentage of the drug’s annual global sales. The royalties decrease as the sales of the drug grows. If the drug’s annual revenue tops $8 billion, there will be no royalty. Blackstone and Apogee have also agreed to negotiate debt financing of up to $500 million.
Atopic dermatitis could be the first of several indications for zumilokibart in inflammation and immunology. Apogee has prioritized asthma and eosinophilic esophagitis as the next disease targets; Phase 2 tests are underway in both. Henderson said the company’s existing cash combined with the Blackstone financing is expected to support commercialization of zumilokibart in all three indications without needing to rely on the capital equity markets.
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