Alzheimer's startup Alzheon bags $10M and beats a path to Phase III

The veteran Alzheimer's researchers at Alzheon believe their novel treatment for the disease has a chance to come through where so many others have failed, raising $10 million amid a "perfect storm" for the company's top prospect, the CEO said.

Like many investigational projects in the field, Alzheon's drug targets beta amyloid proteins, buildups in the brain widely believed to contribute to the disease's neurodegenerative effects. But unlike the slew of high-profile--and largely failed--antibody treatments, Alzheon's candidate is an oral tablet designed to interrupt the formation of beta amyloid before the proteins have a chance to damage brain tissues and destroy memory.

As for that perfect storm, Biogen ($BIIB) turned heads around the industry last month with data from an early trial in which its amyloid-targeting antibody successfully blasted away the buildups and, most important, demonstrated a dose-dependent effect on patients' cognition. That, Alzheon CEO Martin Tolar said, confirms the beta amyloid hypothesis, giving drug developers the clinical validation they've been seeking for decades. Now, with positive Phase I results and years of data from failed studies past, Alzheon is preparing to take its anti-amyloid contender into late-stage development.

The treatment, ALZ-801, is a prodrug of tramiprosate, transforming into that compound once in the body. Tramiprosate was the main ingredient of Neurochem's Alzhemed, which, like most Alzheimer's treatments, failed spectacularly in Phase III. But Alzheon has learned the lessons from that 2009 disaster, Tolar said, addressing tramiprosate's variability problems and tolerability issues with its prodrug approach, in the process crafting a small-molecule treatment that can be dosed once daily.

The plan now is to largely duplicate tramiprosate's Phase III program with ALZ-801, this time homing in on patients with the ApoE4 gene, believed to predispose its carriers to Alzheimer's. The $10 million fundraise, led by Ally Bridge Group, will help Alzheon in "fine-tuning" its operation in the run-up to Phase III, Tolar said, which includes building out its team and locking down a new corporate headquarters in Framingham, MA, with room for growth. Tolar figures the company will be ready to get rolling with its late-stage effort later this year, likely raising more cash but steering clear of partnering until it has come out the other end of Phase III.

And Tolar, a former head of business development at Pfizer ($PFE), said he has carried over that company's devotion to "good collective trial hygiene." For Alzheon, that means relying on CROs where necessary but staying at the driver's seat in Phase III.

"And that's what we've done," he said. "We are drug developers. This is exactly in our sweet spot."

- read the announcement