|Cortendo CEO Matthew Pauls|
Swedish-American biotech Cortendo is expanding its focus on rare endocrine diseases, buying a pair of Phase II treatments for acromegaly for a combined $35 million.
Cortendo agreed to pay Aspireo Pharmaceuticals $30 million for somatoprim, or DG3173, a treatment designed to block the excess growth hormone production that characterizes acromegaly. The drug demonstrated a positive effect on hormone secretion in three Phase I trials, the company said, and matched up to Novartis' ($NVS) leading acromegaly treatment Sandostatin in Phase II.
In a separate deal, Cortendo is paying $5 million to Australia's Antisense Therapeutics in exchange for ATL1103, a growth hormone-targeting drug that met its primary goal in a Phase II acromegaly study. The upfront payment breaks down to $3 million in cash and a $2 million equity investment in Antisense Therapeutics, and Cortendo is promising up to $105 million more if ATL1103 comes through on its development and commercial goals. Antisense Therapeutics is hanging onto the drug in Australia and New Zealand, and the biotech gets to keep the rights to all non-endocrinology applications for ATL1103.
To fund the deals, Cortendo is pulling the trigger on a $33.2 million private placement, tapping an investor syndicate that includes Longwood Capital, TVM Capital RA Capital and New Enterprise Associates.
Meanwhile, the biotech is running a Phase III trial on the Cushing disease treatment COR-003, a souped-up version of the now-generic ketoconazole, which is already used off-label for the rare disorder. The biotech has come up with a proprietary spin on the drug that makes it safer and better targeted, CEO Matthew Pauls has said, and Cortendo is now working through a Phase III trial to prove its promise
"The addition of two novel, late-stage investigational compounds for the treatment of rare endocrine disorders, DG3173 and ATL1103, coupled with our existing Phase III asset for endogenous Cushing syndrome, COR-003, establishes the cornerstone of Cortendo's rare endocrine disease franchise and demonstrates our commitment to becoming a leader in providing innovative therapeutic options to patients with rare diseases," Pauls said in a statement