Flagship Pioneering has been as active as any venture firm at funneling its investment dollars into microbiome drug developers. It’s putting some more of that cash to work as of this morning, unveiling a startup, Kaleido Biosciences, that has been incubated within its walls for two years and is run by a prominent former Boston-area CEO.
Mike Bonney (pictured), the former head of antibiotics developer Cubist and until late last year a Third Rock Ventures partner, has been named the CEO and chairman of the Cambridge, MA, startup. Flagship says that the company is already capitalized with $65 million, including an unspecified amount of financing that closed this morning. The company aims to develop both drugs and nutritional health products based on a method of tweaking the microbiome—the trillions of bacteria that colonize our bodies—with drugs.
Kaleido appears to be much further along than the typical biotech startup upon its debut. According to two separate statements Monday morning, the company has been incubated within Flagship since 2015. It already has 60 employees, three experimental therapies in human testing, and will “surpass 20 human studies over the next 18 months” with potential treatments it is developing for cancer, and infectious and rare genetic and diseases.
Startups across the U.S. and abroad have formed to focus microbiome research into the development of drugs and diagnostics, and Flagship has been among the most interested. The firm, which according to an SEC filing last week is in the process of raising a new $500 million fund, previously formed Seres Therapeutics (NASDAQ: MCRB). While Seres has had its share of ups an downs, it was the first microbiome drug developer to go public in the U.S. Flagship also started Evelo Biosciences, which aims to harness the microbiome to develop drugs for cancer and immune diseases.
The field faces questions: there are several unknowns regarding microbiome drug development. Sometimes it’s unclear whether the microbiome is actually causing disease. Additionally, the microbiome of each patient can vary, meaning it can be hard to predict whether a therapy will have the same effect on each patient. There are also manufacturing and regulatory hurdles in developing such therapies.
Nonetheless, investment in the field has increased. In 2013 there was $13 million in investments disclosed in microbiome drug developers. In 2015, there was over $300 million—not including the $121 million Microbiome Initiative launched by the Obama administration that year.
Kaleido’s take, according to a statement Monday morning, is to try to use chemical drugs that alter the metabolism of the microbiome. Specifically, the drugs are meant to “enhance or protect” the microbiome’s ability to chew up nutrients and use chemical signals to talk with other parts of the body. Kaleido said it is currently pursuing five disease areas, though it wasn’t specific.
Bonney, meanwhile, is best known as the longtime CEO of Cubist, which Merck (NYSE: MRK) bought for $9.5 billion in 2014. He then had a short stint as a partner at Third Rock Ventures in 2016. Bonney is currently on the boards of Alnylam Pharmaceuticals, Celgene, and the Whitehead Institute for Biomedical Research.
“I truly believe Kaleido – with its deep scientific understanding, R&D engine and pipeline – has the potential to transform the way we treat and prevent disease,” said Bonney in a prepared statement. “The microbiome is an enormous untapped frontier of medicine, and I am confident that Kaleido will lead the way in advancing new products in this area, both therapeutics and scientifically validated consumer products.”
Flagship said the company’s investors, other than itself, include “a number of institutional and individual healthcare investors, including Bonney.” Here’s more on Flagship’s venture model and the challenges ahead for microbiome drug developers.