Disc Medicine has secured cash to advance hematology assets picked up from AbbVie and Roche, inking a merger with the floundering Gemini Therapeutics and tapping a starry syndicate of VCs to extend its runway into 2025.
In February, Gemini outlined plans to lay off 80% of its staff and narrow its focus to IND-enabling work on its potentiating antibody for complement factor H protein. The actions were intended to preserve cash. Gemini ended last year with $136.6 million in cash and equivalents. Now, Disc has struck a deal to secure whatever is left of the cash pile.
Massachusetts-based Disc expects to exit the deal with $175 million in cash and equivalents, including the $53.5 million that it has lined up from an Access Biotechnology-led syndicate that includes OrbiMed, Atlas Venture, 5AM Ventures, Novo Holdings, Arix Bioscience, Rock Springs Capital and Janus Henderson Investors. Disc will use the money, which it expects to last into 2025, to move a pipeline featuring drug candidates in-licensed from AbbVie and Roche through multiple clinical trials.
The biotech disclosed the start of a phase 2 clinical trial of bitopertin, the glycine transporter 1 inhibitor it picked up from Roche last year, in conjunction with news of the merger. Disc is studying the candidate in erythropoietic protoporphyria, a genetic disorder that causes acute, painful photosensitivity and potential liver disease. Roche advanced bitopertin as far as phase 3 in schizophrenia before offloading the asset.
At Disc, bitopertin is moving through the clinic in parallel to DISC-0974, an anti-hemojuvelin antibody that the biotech in-licensed from AbbVie in 2019. Disc sees DISC-0974 as a way to suppress hepcidin production and increase serum iron levels, leading it to kick off a phase 1/2 study in participants with myelofibrosis and anemia earlier this year.
Disc raised a $90 million series B round to fund the work 11 months ago. Facing a biotech bear market, the company has opted to add to its cash pile by trading stock for Gemini, securing cash and a Nasdaq listing, and tapping the syndicate of VCs that supported its series B. Pre-merger Disc shareholders are expected to own approximately 72% of the combined company.