Engrail closes $157M series B, fueled by investors' renewed interest in neuropsychiatry

Engrail Therapeutics has closed a nine-digit series B to further its neuropsychiatric pipeline, the latest evidence that investors are flocking to fund new treatments in this resurgent therapeutic area. 

The success of the $157 million fundraise was due partly to a groundswell of interest stemming from Big Pharma's buyouts late last year, according to President and CEO Vikram Sudarsan, Ph.D. The acquisition of neuropsychiatry-focused biotechs Karuna Therapeutics and Cerevel Therapeutics by Bristol Myers Squibb and AbbVie, respectively, “accelerated” Engrail's raise in its home stretch, Sudarsan told Fierce Biotech in an interview, although most investors were lined up before those deals were announced. 

The additional capital bumps Engrail’s cash runway into roughly the middle of 2026, the CEO said, with a focus on a phase 2 trial testing ENX-102 in patients with generalized anxiety. The biotech expects topline data in the first half of 2025, with “several” patients randomized to date.

Engrail has been a lean team with 16 full-time employees and consultants but expects to grow, particularly on the clinical development side. Sudarsan wouldn't commit to future financing plans, be it an IPO or another private round. 

Behind ENX-102 are two staggered preclinical molecules. Sudarsan said depression and anhedonia med ENX-104 is set to complete nonclinical development soon after which Engrail will ask regulators to greenlight a phase 1 study paid for by the new financing. Post-traumatic stress disorder treatment ENX-105 is a few months behind ENX-104, the CEO explained.

“The use of proceeds [is] really around clinical programs or getting preclinical programs into the clinic,” he said, meaning these funds won’t go toward significantly growing the company’s preclinical pipeline. 

The series B, which Sudarsan described as “highly oversubscribed,” was co-led by F-Prime Capital, Forbion and Norwest Venture Partners, with each snagging a board seat. Investors from RiverVest and Red Tree are also joining the board after contributing to this round. 

“At the end of the day, it's a great group of investors,” Sudarsan said. “I think that's what's most reassuring for us, and it's a big vote of confidence.”

Editor's note: This story was corrected to reflect that Engrail expects topline data from a phase 2 trial testing ENX-102 in the first half of 2025.