Newleos Therapeutics Raises $93.5M to Advance Roche's Neuropsychiatric Cast-Offs

Newleos Therapeutics, a newly launched biotechnology company, has secured $93.5 million in series A funding to develop four neuropsychiatric drugs previously dropped from Roche's pipeline. The Boston-based startup, helmed by Roche alumni, aims to advance these compounds through clinical trials, targeting anxiety, schizophrenia, substance abuse disorders, and social anxiety.

A Strategic Acquisition of Promising Candidates

The four drugs acquired by Newleos were put through at least Phase I clinical trials by Roche before being axed in February 2024. This strategic move allows Newleos to leverage years of prior research and development, potentially accelerating their path to market.

David Donabedian, president and board member of Newleos, explained the company's focus: "After COVID, there were high rates of depression around the globe, and we have been thinking about how to make an impact in the neuro space."

The company's lead molecule, NTX-1955, is a GABAA-α1 selective positive allosteric modulator targeting anxiety. Unlike traditional benzodiazepines, NTX-1955 aims to avoid safety and abuse issues by specifically targeting amygdala receptors without affecting other parts of the brain or body.

Experienced Leadership and Ambitious Timeline

Newleos boasts a leadership team with significant experience in CNS drug development. Chief Medical Officer Federico Bolognani, along with co-founder William Martin, bring expertise that could prove crucial in navigating the challenges of neuropsychiatric drug development.

"Developing drugs in neuropsychiatry is a little different than in other spaces," Bolognani stated. "You need people who have done it before, and we've got people who've been doing it for a long time."

The company's $93.5 million funding provides a two-and-a-half-year runway, with ambitious plans to generate Phase II data from all four drugs by fall 2027. This accelerated timeline is made possible by the advanced stage of the acquired compounds, which Bolognani notes are "not the typical assets you might see in a biotechnology startup."

Diverse Pipeline Targeting Multiple Indications

In addition to NTX-1955, Newleos' pipeline includes:

1. Basmisanil: A GABA modulator being repurposed for schizophrenia and Down syndrome after Roche's unsuccessful trials in ischemic stroke and schizophrenia.

2. NTX-2001: A TAAR1 agonist designed to block dopamine release, targeting substance abuse disorders and addictive behaviors.

3. NTX-1472: A V1a antagonist aimed at treating social anxiety, which the company emphasizes is distinct from Roche's recently dropped balovaptan.

The series A funding round was led by Goldman Sachs Alternatives, with participation from Novo Holdings A/S, Longwood Fund, DCVC Bio, and Arkin Bio Capital. As the company moves forward, Donabedian hinted at potential future investment opportunities, stating, "The series A is already oversubscribed, but we're always looking and always talking to investors."