It turns out the $22.5 million round Impact Biomedicines unveiled two weeks ago was just the start of its financing plans. The startup has now revealed a novelly structured $90 million package to see it through to the approval of JAK2 inhibitor fedratinib and beyond.
Impact has turned to Oberland Capital to access the latest source of cash. Oberland has signed up to make two milestone-based payments of $20 million each. In return, Impact will give Oberland predefined fedratinib royalties. The focus on royalties, not equity, reflects the model of Oberland and specifically the $425 million royalty and credit opportunities fund it put together in 2015.
The deal also gives Impact access to money to help it start racking up fedratinib sales. If Impact gets the drug past the FDA and onto the market, it will have the chance to draw down $35 million to $50 million more in predefined notes from Oberland. Those monies are earmarked for funding the launch and commercialization of fedratinib.
With the $90 million funding package coming two weeks after Medicxi drove Impact to a $22.5 million round, the startup now has the money to take fedratinib to market and beyond.
“We have been clear about our intentions at Impact to bring fedratinib to the patients who need it as quickly as possible,” Impact CEO John Hood, Ph.D., said in a statement. “This financing with Oberland Capital paves the way with the financial resources we need to pursue our plans.”
That represents a whiplash turnaround for fedratinib, albeit one that was enabled by years of work behind the scenes. Fedratinib looked to have run its race when Sanofi pulled the program in response to an FDA clinical hold in 2013. At that time, Sanofi felt the risks of the myelofibrosis and polycythemia vera candidate outweighed the benefits.
Hood, who worked on fedratinib at TargeGen before Sanofi bought the biotech, had a different take. The Impact CEO has worked to acquire the rights to the drug from Sanofi, show the safety events that spooked the French Big Pharma are manageable and persuade the FDA to lift its clinical hold.
That done, Impact now finds itself owning a drug backed by data from 877 patients across 18 trials. Most importantly, the package includes midphase clinical data showing fedratinib improves outcomes in a group of cancer patients who have limited options today.
In 2017, that is the sort of package that carries weight with the FDA.