Immunic wraps up €17.5M Series A, buys immunology programs from 4SC

Bundles of Euro currency notes

LSP and LifeCare Partners have co-led a €17.5 million ($19.6 million) Series A investment in Immunic, a 5-month-old immunology biotech. The cash has enabled Immunic to buy cytokine inhibitor and Crohn’s disease programs from 4SC (FRA:VSC), kick-starting its push to develop into a clinical-stage biotech.

Immunic, which like 4SC, MorphoSys (FRA:MOR) and Rigontec is based in Planegg-Martinsried on the outskirts of Munich, has raised the money to develop oral, small molecule immunomodulators against immune and autoimmune diseases. By developing oral drugs for diseases such as Inflammatory bowel disease (IBD) and psoriasis, Immunic thinks it can give patients a more convenient treatment option than the intravenous formulations many people rely on today.

With LSP, LifeCare Partners, Bayern Kapital, High-Tech Gründerfonds and others participating in the round, Immunic has been able to buy itself a preclinical pipeline from 4SC. In return for an upfront payment, plus milestone and royalty commitments, Immunic has acquired IMU-366 and IMU-838, a pair of immunology programs that sit outside of 4SC’s core focus on epigenetic anticancer drugs.

In IMU-366, Immunic has acquired a family of small molecule RORγt inhibitors, including a lead candidate that is backed up by preclinical efficacy data. RORγt has been an active area of dealmaking, with Allergan ($AGN), Celgene ($CELG), Merck ($MRK) and Johnson & Johnson ($JNJ) among the companies that have opened their wallets to buy a look at programs involving the target over the past few years. Immunic, like Allergan and others, sees RORγt as a way to treat psoriasis.

The second 4SC asset acquired by Immunic is IMU-838, an inhibitor of dihydroorotate dehydrogenase (DHODH). With the DHODH enzyme having a role in activated T and B cell metabolism, Immunic thinks the inhibitor can help patients with Crohn’s disease. Notably, while the likes of J&J’s recently-approved Stelara have given patients with moderate-to-severe forms of Crohn’s injectable treatment options, Immunic thinks it can provide an oral formulation suitable for people with milder conditions.

Immunic plans to test this idea in the clinic, starting with a Phase I study of healthy volunteers before moving into a Phase II trial of Crohn’s patients. The planned advance into the clinic is undergirded by research predating the formation of Immunic.

“We are delighted that we are able to acquire several high-quality drug development programs with targets that have already been proven of high relevance in various immune and autoimmune diseases,” Manfred Gröppel, Immunic co-founder and COO, said in a statement. “Thus, Immunic is well positioned to soon become a clinical-stage biopharmaceutical company with two innovative development programs.”

Gröppel knows the programs from his time at 4SC, where he spent 15 years before leaving to set up Immunic with Andreas Muehler. By the end of his time at 4SC, Gröppel was working as director of business development, a role that put him in charge of the company’s research pacts and licensing deals. In Muehler, Gröppel has a co-founder and CMO who held a string of interim medical positions at Ferring, Otsuka, Takeda and other companies during his seven years working as a freelancer.

The pair now face the new challenge of guiding a young and, by German standards, very well funded biotech toward the clinic. At €17.5 million, the Series A sits toward the top of the list of early rounds in German biotechs. Leon nanodrugs raised €18.5 million last year, Rigontec classes three financings over the past three years as its Series A--giving it a total of close to €30 million--and a decade or so ago elbion and Evotec Neurosciences both pulled in €25 million.