Even though most of the news in the psychedelic medicine industry is dominated by publicly-traded companies, there are private firms quietly doing interesting work and building themselves as future players in the space.
In August we had Beckley Psytech raising $80 million from venture capital investors, and now we have Delix Therapeutics closing a $70 million Series A financing round.
These are major capital raises, vetted by some of the biggest investors in the space. In such a capital-intensive industry, with many public companies lingering below $10 million in cash on hand, we should pay attention to private firms with this kind of capital
So let’s have a look at Delix Therapeutics and their big announcement.
Delix Therapeutics, advancing novel drug development
Headquartered in Massachusetts, Delix Therapeutics is a private neuroscience company focused on “psychoplastogens”: novel neuroplasticity-promoting therapeutics. From the company’s website:
Delix is pushing the frontiers of neuroplasticity research to achieve selective re-wiring of pathological neural circuits. As dysfunctional neural circuits are at the heart of all brain disorders, the Delix platform has broad potential to address a range of diseases including treatment-resistant depression, substance use disorder, PTSD, cognitive impairment in schizophrenia, neurodegeneration, and many others.
Delix is focused on developing next-generation compounds inspired by classic psychedelic molecules that preserve their beneficial mechanisms while avoiding their hallucinogenic properties and other safety liabilities. Their goal is to rapidly advance these compounds through preclinical and clinical development and bring patients FDA-approved, take-home medicines that will serve several unmet needs.
The company states that its discovery engine has produced nearly 1,000 novel compounds, with several potential clinical development candidates identified; and their first two development candidates are currently undergoing pre-IND safety and toxicology studies to enable clinical trials to begin in 2022.
Impressive and potentially very interesting.
Now let’s take a look at the news of their capital raise. The following information is taken from the company’s press release:
Delix announced the closing of a $70 million Series A financing round. The round was led by ARTIS Ventures, RA Capital Management, and founding investor OMX Ventures, with participation from a diverse syndicate of life sciences and psychedelic investment funds. The Company expects to use the proceeds to advance two lead candidates through Phase 1 clinical trials, further expand its drug discovery platform of novel neuroplasticity-promoting compounds known as psychoplastogens, and continue to rapidly grow its world-class team.
“We appreciate the overwhelming support from new and early investors alike, and continue to attract top neuroscience, chemistry, and biotech talent as we pursue a unique pathway toward treating – and potentially healing – neuropsychiatric conditions in a new way, at scale,” said Mark Rus, Delix Therapeutics CEO. “We’ve made tremendous progress towards developing efficacious and easily manufactured compounds that have the potential to deliver safe, fast-acting, FDA-approved treatments to help patients in need.”
Delix’s robust and innovative discovery engine has produced nearly 1,000 novel compounds to-date, with several potential clinical development candidates identified. The Company’s most advanced compounds, which have been profiled in Nature and Cell, are non-hallucinogenic analogs of clinically-validated first-generation psychedelics like psilocybin, LSD, DMT, and MDMA. Delix’s orally bioavailable compounds preserve the long-lasting beneficial rewiring of neurons without the risk, safety liabilities, and other patient access barriers inherent to first- and second-generation psychedelics. The improved safety profile, non-hallucinatory efficacy, and simplified manufacturing process of Delix’s psychoplastogens makes its novel compounds highly scalable and suitable for early use in patients. DLX-1 and DLX-7, the first two development candidates to emerge from Delix, are currently undergoing pre-IND safety and toxicology studies to enable clinical trials to begin in 2022.
Senior Partner of ARTIS Ventures and Delix Board Member Vasudev Bailey said, “Delix is at the forefront of neuroscience with a growing platform of novel compounds, a great team, and a novel approach. Delix has the potential to advance our understanding of neuroplasticity, a core component of psychedelics, and its ability to heal. Through its platform, we see a significant opportunity for Delix to develop next generation therapies, with strong IP protection and the potential to positively impact a range of neuropsychiatric and neurodegenerative conditions.”
Andrew Levin, Managing Director at RA Capital Management, added, “The healthcare system is in serious need of new and improved neuropsychiatric treatments that are scalable and more accessible than first- or second-generation psychedelics. We have been looking for an optimized scientific approach to achieve this, and believe that Delix’s team, therapeutic strategy, and early lead candidates are on the critical path.”
Additional investment funds participating in the round include: Apeiron, Bail Capital, Casa Verde Capital, Dolby Family Ventures, Negev Capital, Noetic Fund, Ocama Partners, Palo Santo, Presight Capital, PsyMed Ventures, R2, Re.Mind Capital, Saya Bio, Vertical Venture Partners, WPSS, and other leading family investment funds.
“This funding is an important step in transforming our years of scientific research and discoveries into innovative treatments for patients in need,” said Professor David E. Olson, co-founder and Chief Innovation Officer of Delix Therapeutics. “Our preclinical data to-date suggest that our compounds are unlike anything currently in psychiatrists’ arsenals and have the potential to treat a wide range of conditions. Because the Delix platform directly reverses cortical atrophy — the root cause of many brain disorders — we are optimistic that our treasure trove of novel compounds will yield many safe and scalable treatments for improving mental health.”
For more on Delix check out the company’s News page. For more information on investing in private firms, see our feature How to Invest in Private Canadian Psychedelic Companies