EP Vantage Interview - Circassia gets $100m injection for allergy trials

Three months after Denmark’s Symphogen raised €100m ($137m), one of the biggest financings of a private drug developer, Circassia has confirmed that a US headquarters is certainly not necessary to attract substantial sums of capital (EP Vantage Interview - Symphogen awaits proof of concept as funding secured, January 26, 2011).

The privately-held spin out from Britain’s Imperial College has raised £60m ($98m) from existing investors to fund pivotal trials of its T-cell allergy vaccine, which the company believes is the most advanced of its kind in development. Cat and ragweed allergies will be the first phase III settings tested and trials should get going later this year, chief executive Steven Harris tells EP Vantage.

Short peptides

Circassia’s allergy vaccine pipeline has been generated by a platform technology called ToleroMune. This identifies short peptide sequences called epitopes, typically 10 to 20 amino acids long, from the allergen proteins that are responsible for causing allergic reactions.

When injected, these epitopes induce regulatory T-cells, which down regulate components of the allergic response to the allergens from which the peptide was originally derived. In this way, a sufferer develops tolerance of the antigen – be it from cat, ragweed or grass – that causes the allergic reaction.

The company believes this approach has the potential to create effective allergy treatments without the need for dose escalation or serious adverse reactions associated with traditional immunotherapies.

“We use very short epitopes…and therefore you don’t get the reaction you get with whole allergens,” Mr Harris says. “We’ve shown you can give four injections and get excellent tolerance.”

So far, Circassia has nine phase II studies completed or ongoing, in 880 subjects in four allergies. Proof of concept was seen in cat allergies earlier this year in a double-blind, placebo controlled phase II study in 202 patients, who had significantly reduced symptoms.

“We have a big data base of clinical data now. Our safety data is absolutely excellent, we can say now with some degree of confidence, with the number of people we’ve had in trials,” he says.

More evidence

Circassia now has to prove the technology works in much larger trials.

The phase III studies are being designed with long run-ins to get an accurate picture of patients at baseline, and make sure people with measurable allergies are recruited.

Ragweed patients will be recruited this year and tracked over this summer’s ragweed season, then dosed next year, and monitored through the following season. Results will be available in 2013.

In the cat study, recruits will be observed over the summer to achieve a picture of patients’ symptomology in their homes. They will move into the dosing stage of the phase III at the back end of the year; results could be available next year.

Both allergies will be tested in two phase III studies recruiting 600 patients each, totalling four trials dosing 2,400 patients.

“We now know we’ve got the funds in place to finish the studies,” Mr Harris says.

Not typical

The sum raised by Circassia is not typical for VC-backed private companies, but then the company does not strictly fit into this category. It has been funded from an early stage by Imperial Innovations, a UK-listed “company builder”, as chief executive Susan Searle describes it. Circassia has been the firm's biggest investment to date, she says.

In total, Circassia has raised £93m since it was founded in 2006. Imperial Innovations, which has provided £14m of that financing, values its 18.4% stake at £19.7m, implying Circassia is valued at a little over £100m.

Mr Harris admits that his investor base is not the “normal” VC crowd – the register also includes Invesco Perpetual, a dominant investor in both the public and private UK life sciences sector, Goldman Sachs and Landsdowne Partners.

“But it shows that there are different types of investor out there, which is good for the industry,” he says.

Open minded

Mr Harris says a number of shareholders have invested in his previous ventures, and they are no doubt hoping for a repeat of past successes. He was part of the team that sold PowderJect to Chiron for $900m in 2003 and two years later was chief executive of Zeneuslater when it was sold to Cephalon for $360m.

It remains to be seen whether Mr Harris can repeat the trick with Circassia. At this stage, all options, from a sale, to a licensing deal or setting up a sales force, remain on the table.

“We’re open minded, we’ll do whatever is best for our shareholders” he says. “But we’re not under pressure to follow any one path.”

As well as starting the phase III programme, more important mid-stage data are due later this year. The results of a 12 month follow-up from the phase II cat allergy trial are due soon, which will help determine how long the vaccine has an effect, and whether booster shots will be required.

By the end of the year phase II data from a large study with 275 patients allergic to ragweed should be available, and a smaller 50 patient study looking at the product’s efficacy in grass allergies.

Following encouraging phase II data in house mite allergy last year, Circassia has identified the four indications it wants to take into late-stage testing. T-cell based vaccines remain a novel and largely untested technology, but with a substantial sum of cash now available to push ahead, Circassia’s progress so far is not to be sneezed at.

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