Gaba Therapeutics Inc., of Newport Beach, Calif., closed on a series A of up to $15.5 million to create a new compound for treating mood disorders, particularly anxiety and depression.
Gaba's lead compound, GRX-917, is a deuterated version of etifoxine, an anxiolytic medication whose onset and efficacy are comparable to benzodiazepines such as Xanax (alprazolam) and Ativan (lorazepam). Etifoxine is believed to achieve anxiolytic activity by increasing levels of neurosteroids, endogenous compounds and endogenous compounds with antidepressant, neuroprotective, neurotrophic and anti-inflammatory properties, so GRX-917 could possibly treat a range of CNS diseases, including epilepsy, multiple sclerosis and Alzheimer's disease.
"This is a unique compound for its efficacy and minimal side effects," Ian Massey, Gaba's CEO, told BioWorld. "Anxiety represents a huge, unmet medical need."
Anxiety disorder is considered one of the largest mental health issues in North America, affecting nearly 40 million people annually in the U.S. Only about one-third of anxiety disorder sufferers receive treatment, according to the Anxiety and Depression Association of America.
GRX-197's main mechanism of action is to increase the amount of naturally occurring neurosteroids (like allopregnanolone) by activation of translocator protein on mitochondria. That increase of endogenous neurosteroids occurs in areas in the brain where they are used to activate GABA receptors, slowing dysregulated brain activity in diseases like anxiety and depression, but minimizing the typical side effects of GABA drugs, like benzodiazepines. Additionally, increases of neurosteroids acting at other receptors have been found to minimize neuroinflammation, affect neuroregeneration and modulate the activation of microglia - potentially key elements responsible for Alzheimer's disease, multiple sclerosis and Parkinson's disease.
The compound's biggest advantage, Gaba's chief scientific officer, David Putman, told BioWorld, is that it minimizes the side-effect profile of benzodiazepines, which can include drowsiness, confusion, dizziness and trembling. He said he hopes the studies lead to patient dosing of only once per day, "which is an additional advantage to deuteration," he added. Putman has more than two decades experience with companies including Syntex Corp., Roche Holding AG, UCB SA and Kadmus Pharmaceuticals Inc.
The series A investment, secured from Berlin-based Atai Life Sciences AG, will fund the program through a phase IIa proof-of-concept study. Gaba plans to enter the clinic by the end of 2019. Atai is a global biotech platform and company builder focusing on treating mental health disorders.
This is Gaba's official launch and its first round of fundraising; until now, the company had been self-funded, Richard Farrell, Gaba's chief financial officer, told BioWorld. Farrell is a longtime investment banker, having worked for Beerworth & Partners in Sydney, Ernst & Young Corporate Finance and Deloitte Touche Corporate Finance. Putman co-founded Anvyl LLC, which focused on treating CNS disorders such as epilepsy, anxiety and pain.
The company will remain fairly small in the near term. Massey, the former head of research and early development at Roche Bioscience in Palo Alto, Calif., said he plans to keep staffing as it currently is, at four full-timers, adding around 15 advisors and consultants over the next 12 months. He said he has been working on this deal since the beginning of last year and plans to use some of Atai’s resources. One of those resources is Srinivas Rao, who will be Gaba’s chief medical officer. Rao is also the chief scientific officer at Atai.