Orphazyme hauls in $24M to advance its rare disease contender

Danish biotech Orphazyme raised a €20 million ($24 million) B round to fund its work on rare lysosomal storage disorders, tapping an investor syndicate that includes Novo Nordisk's ($NVO) venture arm as it rolls toward Phase II trials.

Orphazyme's lead candidate, Orph002, is a treatment for Niemann-Pick disease type C (NPC), a rare disorder in which cholesterol builds up in patients' cells and leads to neurological problems that often prove fatal. The drug is a small-molecule booster of the body's heat shock proteins, designed to correct the cellular dysfunction at the heart of NPC.

The latest funding round, led by new investor Kurma Partners, will bankroll Orphazyme's planned Phase II trial for Orph002, which the company is now preparing. Idinvest Partners joined in on the financing, as did repeat backers Novo A/S, Sunstone Capital and Aescap Venture.

"Kurma Partners is very excited about Orphazyme, which has taken a leadership position in the promising field of harnessing the therapeutic potential of the heat shock proteins for degenerative diseases," Managing Partner Remi Droller said in a statement. "The company is founded on scientific excellence, and has successfully transitioned from discovery to development."

Orphazyme closed its $20 million A round back in 2011, shortly after signing a $120 million deal with CytRx ($CYTR) in which it acquired that company's molecular chaperone technology. Beyond Orph002, the biotech is also at work on a recombinant version of human heat shock protein 70 for a variety of lysosomal storage disorders.

Orphazyme's fundraise comes just days after Pfizer ($PFE) and New Enterprise Associates pitched in on a $25 million fundraise for Vtesse, a U.S. company at work on an NPC treatment of its own. Vtesse's lead drug, designed to clear away the same cellular cholesterol buildups, is on the verge of entering a Phase II/III trial.

- read the statement