Newleos Therapeutics Launches with $94M to Advance Brain Health Drugs

Boston-based Newleos Therapeutics has officially launched with a $94 million Series A funding round, aiming to develop novel treatments for a range of mental health conditions. The company's pipeline, licensed from Swiss pharmaceutical giant Roche, includes four drug candidates currently in human testing for disorders such as generalized anxiety disorder, substance use disorder, and cognitive impairment.

Founding Team and Investor Backing

Newleos was co-founded by a team of experienced biotech executives, including David Donabedian as CEO, William Martin as chief development officer, and Michael Miguel Sobral as head of strategy and operations. Federico Bolognani, a physician-scientist with leadership experience at Roche, VectivBio, and Therachon, serves as the company's chief medical officer.

The Series A funding round was led by an arm of Goldman Sachs, with participation from Novo Holdings, DCVC Bio, Arkin Bio Capital, and the Longwood Fund. Christoph Westphal, founding partner of Longwood Fund, will serve as the executive chairman of Newleos' board.

Drug Pipeline and Development Strategy

Newleos' drug candidates are designed to regulate various molecules and proteins involved in brain cell communication. The most advanced candidate has completed Phase 1 studies and is being evaluated as a treatment for a rare, genetic neurodevelopmental disorder.

CEO David Donabedian emphasized the significant unmet need in neuropsychiatric indications, stating, "Anxiety and substance use disorders represent some of the most prevalent neuropsychiatric indications with high unmet need, representing over 25% of mental illnesses in U.S. adults and impacting over 60 million individuals."

The company plans to use the newly secured capital to conduct proof-of-concept clinical trials across its programs, leveraging the founding team's extensive experience in creating companies and developing drugs for the central nervous system.

Rising Interest in Neuroscience Investments

Newleos' launch comes amid increased venture capital interest in neuroscience research. In the past year, prominent firms invested more than $1.5 billion into nervous system-focused startups, a significant increase from the less than $1 billion annual sums seen in 2022 and 2023.

This trend is further exemplified by recent fundraising successes in the field, such as Atalanta Therapeutics' $97 million raise for epilepsy and Huntington's disease treatments, and Engrail Therapeutics' $157 million Series B round for programs targeting generalized anxiety disorder, depression, and PTSD.

As Newleos Therapeutics joins the ranks of well-funded neuroscience startups, the pharmaceutical industry continues to see growing investment in addressing the complex challenges of brain health and mental illness.