Rising obesity rates in the United States are a major health concern in the nation with 69% of the population being overweight and 36% being obese. More alarming is the increasing prevalence of obesity in children and adolescents. Kallyope is developing therapies focused on studying the gut-brain axis, seeking to understand the communication mechanisms between the gut and brain by mapping circuits in the brain and mapping the circuits between the gut and the brain. Currently, in a preclinical phase, human clinical testing for the company’s safety satiety circuits for weight loss are planned to start later this year.
AlleyWatch sat down with Kallyope CEO Nancy Thornberry to discuss the application of this novel biotechnology, the company’s future plans, and recent funding round, which brings its total funding to $243M across four rounds.
Who were your investors and how much did you raise?
Kallyope raised a $112M Series C financing. All investors from the Series B financing participated in the Series C round, including The Column Group, Lux Capital, Polaris Partners, Euclidean Capital, Two Sigma Ventures, Illumina Ventures, Alexandria Venture Investments, and Bill Gates. New investors include Casdin Capital, Greenspring Associates, and two unnamed leading institutional investors.
Tell us about the product or service that Kallyope offers.
Kallyope is a leading biotechnology company focused on identifying and pursuing therapeutic opportunities involving the gut-brain axis. We have established industry-leading capabilities in designing oral small-molecule drugs that selectively target the gut but not the rest of the body. While our company is still preclinical, our lead program targeting satiety circuits for weight loss in obesity is expected to begin clinical testing in humans later this year. A second program targeting gut barrier function with potential relevance for inflammatory bowel disease (IBD) and several other diseases is anticipated to enter the clinic soon after.
What inspired the start of Kallyope?
The importance of the connection between the gut and the brain has been known for centuries—but an understanding of this bi-directional communication at a mechanistic level has only become possible in the last several years owing to advances in technology. It was the vision of the founders that it would be possible to use new technologies, including some that were developed to map circuits in the brain, to map the circuits between the gut and the brain, and to target circuits involved in disease with gut-restricted molecules.
How is Kallyope different?
We’re a platform, multi-product biotech company located in Manhattan. Our therapeutic strategy is to target circuits connecting the gut and the brain with gut-restricted small molecules. We are the first-mover in this space. The majority of our research is in-house, and all programs are invented in-house and enabled by our platform.
Who do you consider to be your primary competitors?
The gut-brain axis is an area of increasing interest. We are first movers in developing a comprehensive map of gut-brain circuits, but we anticipate increasing interest in biopharma in this area. There are a few other biotech companies also working on gut-brain axis research.
What market does Kallyope target and how big is it?
Our lead program targets satiety circuits for obesity, and there is a very large unmet need in this space. A recent New England Journal of Medicine article estimates that nearly 50% of adults in the US will be obese by 2030. Obesity is, by far, the greatest risk factor contributing to chronic disease in the US.
What’s your business model?
We’re a platform company, which means we are pursuing opportunities to create therapeutics in a number of areas using the same suite of technologies. Our products will all be of the same modality, oral small molecule drugs.
What was the funding process like?
We started the Series C process formally just after JPM and essentially finalized allocations in late February.
What are the biggest challenges that you faced while raising capital?
There were no significant challenges. We were fortunate to have all of our existing investors participate in this financing, and we added four new high-quality investors to the syndicate.
What factors about your business led your investors to write the check?
Targeting the gut-brain axis has the potential to have an impact on multiple diseases of high unmet need. In addition, the team we have assembled in NYC is second to none. We’re fortunate to have long-term focused investors who believe in our mission and team, with the ability and willingness to stay with us for the long term.
Targeting the gut-brain axis has the potential to have an impact on multiple diseases of high unmet need.
What are the milestones you plan to achieve in the next six months?
We are continuing work that diversifies our portfolio of programs while moving our first program toward the clinic.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Focus only on critical path activities which will increase the value of the company for shareholders and patients.
Where do you see the company going now over the near term?
This financing enables us to advance a portfolio of diversified programs to the clinic.
What’s your favorite restaurant in the city?
I Sodi, in the West Village.
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