Lessons learned from development of hepatitis C therapies could be applied to the underserved hepatitis B population, potentially leading to a functional cure through a combination of optimized drugs that attack the virus from different angles.

That is the mission of 2-year-old Aligos Therapeutics Inc., a South San Francisco-based startup focused on liver-related diseases. It just completed a $125 million series B financing with repeat investors and several new ones.

The chosen name is a reference to its oligonucleotide research and a tipped hat to Alios Biopharma Inc., a company acquired by New Brunswick, N.J.-based Johnson & Johnson in 2014 for $1.75 billion, from where several members of Aligos’ management team hailed.

“This is a team that’s been working together for two decades,” Aligos CEO Lawrence Blatt told BioWorld.

Aligos has three hepatitis B virus (HBV) products set to enter the clinic this year: ALG-010133, an S-antigen transport-inhibiting oligonucleotide polymer (STOP); ALG-000184, a capsid assembly modulator (CAM); and ALG-ASO, an antisense oligonucleotide. Initial data should be ready in early 2021, at which point the company would seek another financing.

Lessons learned from HCV

Blatt began working on interferons for hepatitis C virus (HCV) therapeutics in the early 90s while at Thousand Oaks, Calif.-based Amgen Inc. The eventual outcome discovered years later during his time at J&J was that it would take a triple combination therapy to reach a 100% sustained virologic response.

“The first lesson is that you need to have combination therapies,” Blatt said, “so monotherapies are not going to be effective. You have to have all of the combinations in one place. The companies most successful with HCV were those that built portfolios with all of the components.”

The second lesson was learned from Pharmasset Inc., the original developer of the HCV drug Sovaldi (sofosbuvir, Gilead Sciences Inc.). First-generation drugs with validated mechanisms never made it to market, but “what Pharmasset did was to optimize the pharmacology,” Blatt said. At Aligos, “we’re taking mechanisms that are already in the clinic and have some level of validation and optimizing the pharmacology.”

The mechanisms of the three HBV candidates set to enter the clinic have shown promise in preclinical studies. The CAM candidate, Blatt said, “is the most potent CAM described to date, around 500 picomolar, an order of magnitude more potent than anything that has been demonstrated.”

Strong preclinical activity of two CAMs, ALG-001075 and ALG-001024, was presented in November 2019 at the American Association for the Study of Liver Disease (AASLD) annual meeting in Boston, showing potent inhibition of HBV capsid formation and covalent closed circular DNA formation. In murine studies, evidence indicates CAMs could be dosed once daily in humans.

Aligos gained ALG-000184 in June 2018 through a license with Emory University and the laboratory of Raymond Schinazi, who founded Pharmasset.

It is expected to enter the clinic behind the aptamer ALG-010133. Unlike oligonucleotides that bind to messenger RNA, “aptamers fold up into 3-D structures that actually bind to proteins” similar to monoclonal antibodies, “but these can penetrate cells,” Blatt said. The result is the inhibition of hepatitis B surface antigen (HBsAg) formation. Delivered via subcutaneous administration, the drug has demonstrated the most potent in vitro anti-S-antigen activity to date, Blatt said.

Aligos’ third HBV candidate, set to enter the clinic toward the end of 2020, targets viral messenger RNAs such as those that encode the HBsAg protein. The mechanism could lower HBsAg levels, allowing the immune system to fight the virus.

“With the money we’ve raised, we’re going to be able to get all three of those mechanisms in the clinic and demonstrate initial safety data and pharmacology, report those data, and then we’ll be ready for another round of financing,” Blatt said.

The FDA approved Sovaldi, a nucleotide analogue polymerase inhibitor, in December 2013. Michael Sofia, who co-discovered the drug while at Pharmasset, received a Lasker-DeBakey Clinical Medical Research Award in September 2016, along with two university scientists, for developing a system to study the replication of HCV and using the system to screen cells and identify what would become Sovaldi. Gilead bought Pharmasset in a $11.2 billion deal that closed in January 2012.

Blatt said he believes working with more optimized compounds could translate to a similar success story for HBV. With HCV, he said, “you initially saw protease inhibitors that were approved and had very short product life cycles because other drugs came along that were better.”

HBV is a liver infection transmitted by bodily fluids. It affects an estimated 257 million people worldwide and about 6% of adults in the western Pacific and African regions, where it is most prevalent, according to the World Health Organization (WHO). About 900,000 people die each year from the chronic form of the disease, which often leads to cirrhosis or liver cancer. An HBV vaccine is highly effective in preventing infection, but patients already infected face lifelong viral suppression with immunomodulators and nucleotide or nucleoside analogues.

“HBV is very underserved right now and is the leading indication for liver transplant,” Blatt said.

From Ribozyme to Aligos

The origins of Aligos’ story go back to the 1990s when Blatt met chemist Leo Beigelman while at San Francisco-based Ribozyme Pharmaceuticals Inc., later called Sirna Therapeutics Inc. Sirna was acquired by Kenilworth, N.J.-based Merck and Co. Inc. in 2006 for $1.1 billion and sold to Alnylam Pharmaceuticals Inc., of Cambridge, Mass., for $175 million in 2014.

Following the Merck acquisition, Blatt became chief scientific officer at Brisbane, Calif.-based Intermune Inc., bringing Beigelman and a number of other Sirna staff with him, until launching Alios Biopharma, which completed a $32 million series A round in June 2009. Alios was focused on glycosylated interferon initially for HCV, but also for cancer and multiple sclerosis.

Intermune was later acquired by Basel, Switzerland-based Roche Holding AG for $8.3 billion in 2014, the same year J&J bought Aligos following its $41 million series B in April. Blatt became the global head of infectious diseases at J&J, while Beigelman became vice president of medicinal chemistry and global head of discovery at Janssen Infectious Diseases and Vaccine, a J&J unit.

In 2018, they decided to leave J&J and form Aligos, with Blatt serving as CEO and Beigelman taking on the role of president. They preferred to work in a smaller environment where they could focus on liver diseases, Blatt said.

Aligos raised $5 million in seed funding in March 2018 and $100 million in a series A round in September of that year from Vivo Capital, Versant Ventures, Novo Holdings and Roche Venture Fund. They all returned for the series B that was led by Wellington Management Co. and included investments from Janus Henderson Investor, Boxer Capital of Tavistock Group, Cormorant Asset Management, Pivotal Bioventure Partners and Logos Capital.

Aside from its work in HBV, Aligos is in preclinical development with thyroid hormone receptor beta agonist ALG-THR-β for nonalcoholic steatohepatitis, and it is working on treatments for hepatocellular carcinoma. It also has a partnership with Osaka, Japan-based Luxna Biotech Co. Ltd., a spinout of Osaka University, signed in December 2018 to license modified nucleic acid technology, which helps to reduce toxicity seen with older drug generations.

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