Going from stealth to a $150 million series B in five months may seem fast, but, for Rapport Therapeutics, 10 years of toiling in the labs at Johnson & Johnson beforehand helped the neurological disease biotech accelerate straight from the gate.
The Boston- and San Diego-based company has brought on a new group of investors this round, including Cormorant Asset Management, Fidelity Management & Research Company, Goldman Sachs Asset Management, Logos Capital, Perceptive Advisors, Sofinnova Investments and Surveyor Capital. Rapport’s existing investors, Third Rock Ventures, Arch Venture Partners and Johnson & Johnson Innovation – JJDC, also chipped in again.
“Ultimately, I think what we see and what this new set of investors sees is just a great set of fundamentals that are behind the company and one that I think positioned the company for a really interesting future,” CEO Abe Ceesay told Fierce Biotech in an interview.
Rapport launched in March with Ceesay at the helm—fresh from the president role at Cerevel Therapeutics—and $100 million to develop precision medicines for neurological diseases. The company spun out from J&J, bringing a clinical-stage asset for seizure disorders along with molecular neuroscientist David Bredt, M.D., Ph.D., who now serves as chief scientific officer. Having come from a Big Pharma, Rapport was ready to hit the ground running.
Ceesay has long been a biotech executive, heading up Tiburio Therapeutics as CEO before Cerevel. He says he brings the experience in building and operating a biotech from the ground up through the various stages of development and then growth. But why jump from Cerevel, a company similarly working in neurological disorders, which itself came out of a Big Pharma—in this case Pfizer?
“What attracted me most to Rapport was the ability to really bring to life the concept of precision neuroscience,” Ceesay said. He believes Rapport is closer to cracking the code on targeting the right regions of the brain to change how patients adhere to the therapy and how physicians treat neurological diseases.
J&J has stepped back into a more passive role, providing funding through its investment arm. But that Big Pharma kick-start certainly helped at a time when the majority of biotechs are struggling to make their next fundraising rounds.
“The biotech market has been a challenging one as of late. I do believe that you are seeing financings happening across the sector and ultimately I think when you really peel everything back and really look at what's under these financing, it comes down to companies that have extremely strong fundamentals,” Ceesay said.
Rapport is now nicely capitalized, but, of course, in biotech you never stop thinking about your next fundraising, Ceesay admits. Still, he’s happy with the new group of investors that were brought on with the series B and expects them to stick around for the next two or three rounds. The funds will help grow Rapport’s team from around 20 people into the low 30s or even 40s by the end of the year. The company has headquarters in both Boston and San Diego, splitting between the two major U.S. biotech hubs.
Rapport also has a focus on neuroscience going for it, while breakthroughs in Alzheimer’s disease by Biogen and Eisai and Eli Lilly help reinvigorate investment in the field. Karuna Therapeutics is nearing an FDA submission for a new schizophrenia med, and Biogen also recently snagged an approval for a Sage Therapeutics-partnered postpartum depression therapy. Ceesay sees a lot of opportunity in lesser publicized psychiatric conditions like bipolar disorder, bipolar depression or post-traumatic stress disorder where a significant unmet need remains.
“I do believe that we are kind of in that next frontier for neuroscience. Now, what do we need to do as an industry differently? Or how do we approach this sector? I think it's going to really depend on each individual company and what they bring to bear,” Ceesay said. “For us, what we believe we're bringing to bear is true precision neuroscience.”