Tokai Pharmaceuticals has been chasing after the big players in the prostate cancer field with the idea of combining some of the best features of their drugs into a single pill. Now, with that lead drug candidate, galeterone, on the precipice of a late-stage trial, it’s taking that pitch to Wall Street.
Cambridge, MA-based Tokai has filed papers outlining plans to raise up to $75 million in an IPO. The company will largely use the cash to fund clinical development of galeterone. Should it go public, Tokai would trade on the Nasdaq under the ticker symbol “TKAI.”
Tokai was formed around work done by Angela Brodie and Vincent Njar of the University of Maryland School of Medicine. The company’s hopes revolve around galeterone, which Tokai hopes can break into the increasingly crowded field of prostate cancer treatments. In the years Tokai has been developing galeterone, both Astellas/Medivation (NASDAQ: MDVN) and Johnson & Johnson (NYSE: JNJ) have won FDA approval of oral prostate cancer pills—enzalutamide (Xtandi) and abiraterone (Zytiga), respectively—that have changed the paradigm for treatment, and now bring in more than $2 billion annually combined. Both drugs have shown benefits for patients not just after they’re treated with chemotherapy, but before.
Tokai’s pitch is that galeterone is essentially a combination therapy in one pill. The drug employs tactics used by both enzalutamide (an androgen blocker) and abiraterone (which targets an enzyme called Cyp17 lyase that’s required for androgen production), while also degrading the androgen receptor on tumor cells, in theory blocking the androgen hormones that feed prostate cancer tumors in three different ways. Tokai believes this combination strategy might give it some efficacy advantages over other prostate cancer drugs. And unlike abiraterone, galeterone also doesn’t have to be administered with prednisone, an immunosuppressive steroid.
Given the way its drug is designed to work, and the intensely competitive field, Tokai aims to first find a niche for itself treating prostate cancer patients whose tumor cells have an altered, “truncated” androgen receptor—a group that, Tokai says, may not be effectively treated by drugs like abiraterone or enzalutamide—before branching out into other subsets of prostate cancer patients.
It’s going to be a difficult haul to prove this, of course. Tokai is basing its theory on just four patients with truncated androgen receptors who were in its Phase 2 tests of galeterone, each of whom had at least 50 percent reductions in their PSA levels. The company is in the midst of conducting Phase 2 studies in a variety of different prostate cancer populations, and intends to ramp up a Phase 3 trial for the truncated androgen receptor group in the first half of 2015. The company intends to discuss an expedited approval pathway for galeterone as a treatment for that group, according to the IPO prospectus.
Jodie Morrison, a former executive at Dyax (NASDAQ: DYAX), is the company’s CEO.
Tokai has raised more than $85 million in venture funding from the likes of Apple Tree Partners (49.15 percent stake), Novartis BioVentures (28.12 percent), and entities associated with former Goldman Sachs managing director Muneer Satter.
BMO Capital Markets, Stifel Nicolaus, William Blair, and Janney Montgomery Scott are underwriting the IPO.