Novartis powers Notch cancer biotech Ayala to $30M series B

Ayala CEO Roni Mamluk (Ayala Pharmaceuticals)

Novartis has powered Ayala Pharmaceuticals to a $30 million series B round. Ayala will use the cash to fund mid-phase development of pan-Notch inhibitor AL101 in adenoid cystic carcinoma (ACC).

Israel’s Ayala has advanced quickly since beginning life with two former Bristol-Myers Squibb cancer drugs late in 2017. The following year, Ayala raised a $17 million series A round, started a phase 2 trial of AL101 in ACC and granted Novartis an option on the rights to a second asset in multiple myeloma.  

That connection to Novartis, which began a concerted push into Israel in 2015, has shaped the series B round. Novartis led the round with the support of SBI JI Innovation Fund, Israel Biotech Fund, aMoon and Harel Insurance & Finance Group.

The syndicate has given Ayala the means to step up its clinical trial activities. Talking ahead of the MIXiii BIOMED conference in Tel Aviv earlier this month, Ayala CEO Roni Mamluk said initial data from the ACC phase 2 study are due in the fourth quarter. The series B will take Ayala past that milestone and give it the means to start a phase 2 trial of AL102 in triple-negative breast cancer (TNBC).

Ayala’s deal with Novartis covers the rights to gamma secretase inhibitor AL102 in multiple myeloma, leaving the biotech free to develop the drug in other indications, starting with TNBC. Mamluk hopes to start the TNBC trial by the end of the year.

Both of Ayala’s development programs are targeting patients with notch activating mutations. That focus reflects the early-stage work done by Ayala using tumor models derived from ACC patients with and without notch activating mutations. 

“The responses were very deep and significant when notch was mutated and very minimal when it was not. We have similar data that we generated on our next indication, [TNBC],” Mamluk said. 

Those divergent effects may be explained by the role the notch signaling pathway plays in tumorigenesis in some solid tumors and blood cancers. Inhibiting gamma secretase may disrupt this process by stopping cleavage by the enzyme.