Kala Pharmaceuticals - 2013 Fierce 15

Kala Pharmaceuticals
Drilling through the mucosal barrier

Based: Waltham, MA
Founded: 2009
CEO: Guillaume Pfefer
Clinical focus: Ophthalmology, plus
Website: www.kalarx.com

The scoop: Mucus is an excellent defense system for the human body. The sticky substance keeps bacteria, viruses and other nasty invaders at bay. The mucosal barrier also efficiently blocks therapeutics from reaching some key targets, requiring some crude technologies to overcome it. Witness, for example, the injections into the eye used to treat wet age-related macular degeneration.

Nobody likes to have a needle stuck in their eye.

What makes Kala Pharmaceuticals fierce: Kala's claim to fame is that there's a simple way to overcome a challenging problem--formulating therapies in a way that can allow treatment of eye diseases with a simple eye-drop approach. They coat nanoparticle-sized medicine with a polymer of a certain molecular weight. The work originated in efforts at MIT Professor Robert Langer's lab that date back to the '80s. And while Langer is staying mum about the specific properties of the polymer--an essential ingredient in Kala's secret sauce--he's also compared it to polyethylene glycol, a well-known, low-tox substance that's been tested in a variety of ways.

Once you penetrate that mucosal barrier, it's possible to use smaller doses of nano-sized therapies to do some pinpoint applications that allow the drug to accumulate where it's needed. And last spring, the startup provided some preclinical evidence that a small-molecule receptor tyrosine kinase inhibitor did just that in rabbits. Once Kala makes its point with its lead eye treatment, there's plenty more work ahead on new treatments for the eye as well as the lung, intestines and vagina, for example, which are all protected by mucus. Seeing the potential, the Cystic Fibrosis Foundation recently stepped in with a grant to start testing applications to prevent common lung infections connected to CF.

Animal data, of course, are frequently and notoriously unreliable. But in this instance there are some good reasons to pay close attention. Once you demonstrate proof-of-concept for a new delivery method in an organ like the eye, even if it's a rabbit's eye, you're well along the way to the kind of fast-track human trials that can spawn approvals. And that's where Kala finds itself today.

The company also has a great scientific pedigree.

Kala is one of about 25 biotechs co-founded by Langer, an MIT professor with rock-solid connections to the kind of early-stage venture investors that can get a company up and running in short order. Kala is in many ways a classic Langer startup, featuring one of his former grad students, Justin Hanes (now a professor at Johns Hopkins) as co-founder alongside ex-Johnson & Johnson ($JNJ) exec Colin Gardner.  

A few things make Kala both a standout Langer biotech and a classic example of what the MIT impresario likes to see in all of his companies. They're built around great patents, start off with solid signs of activity in animals, have published papers in a major journal, and include one of his former grad students ready to champion something new and important in medicine.

In this particular case, Kala includes not just one former grad student but two: Hanes and Hongming Chen, the R&D chief at Kala. It was Hanes' work trying to find a substance that could adhere to mucus that created the company, credits Langer. Instead of an adhesive, which others in the field have been trying to accomplish, Hanes came up with a novel way to drill through it.

That's the scientific inspiration behind Kala and the source of its primary champions.

In addition to an excellent scientific network, Langer also has some of the best venture connections in the business. He works with the same group of investors, a trusted team of colleagues with substantial resources at their command at Polaris, Lux, Flagship and Third Rock. ("These guys are good for it," says Langer.)

Bring those elements together and you have the foundation for a solid company that can attract an elite team of seasoned veterans, something that became apparent when Kala brought in Sanofi ($SNY) vet Guillaume Pfefer as CEO.

Another aspect he likes to see: These companies typically start on modest seed rounds and a limited Series A. That way, he says, the founders have a much better shot at retaining some significant equity in the company rather than handing it out. And that formula has proven to be quite effective in a company like Bind, a Fierce 15 alum which just completed a successful IPO.

Investors: New investor Crown Venture Fund LLC, the venture capital arm of the Crown family of Chicago, joined existing investors Lux Capital Management, Polaris Venture Partners and Third Rock Ventures in the round, which brings the company's total raise to about $22 million.

For more:
Langer biotech Kala earmarks $11.5M round for next-gen ophthalmology drug
New Kala CEO plans to raise funds for particle tech programs
Langer upstart rakes in fresh venture cash for mucus-targeting drugs

-- John Carroll (email)

Kala Pharmaceuticals - 2013 Fierce 15
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