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Working with Patients and a Fresh $80M, Fulcrum Eyes a 2019 IPO

Xconomy Boston — 

Fulcrum Therapeutics, a Cambridge, MA, startup run by the former CEO of Epizyme, has closed an $80 million Series B round that lays the groundwork for a likely IPO next year, its CEO says.

The new funding, led by Foresite Capital, comes from a wide array of crossover investors, such as Fidelity Management and Research, that back both private and public companies. These types of rounds often precede IPOs in biotech, and CEO Robert Gould says that is Fulcrum’s plan. The company hopes to go public early next year, after filing papers with the FDA to begin human testing of its first drug, for a rare muscle wasting disease called facioscapulohumeral muscular dystrophy (FSHD), Gould says.

“We think that the strength of the preclinical data and the quality of the compound is such that it’ll be an attractive investment opportunity,” he says.

That has yet to be proven, but Gould has been here before. The one-time Merck executive helped take cancer drug developer Epizyme (NASDAQ: EPZM) public in 2013, raising about $80 million at $15 a share. He left the company two years later and resurfaced as the CEO of Fulcrum in 2016.

Fulcrum is trying to use drugs to control molecular switches that turn genes on or off, hoping to treat a variety of diseases with no effective treatments—starting with FSHD, which is marked by muscle degeneration that starts in the face, back, and upper arms. Though the disease typically progresses slowly and isn’t fatal, FSHD, which affects an estimated 870,000 people worldwide according to the nonprofit FSH Society, can leave patients in wheelchairs or on respirators. There are ways to help manage the disease’s complications, but no available therapies can halt or reverse its progress. Fulcrum’s experimental drug is meant to “at bare minimum” halt the progression of FSHD by preventing the expression of a protein, DUX4, implicated in the disease, Gould says.

Its scientific aspirations aside, however, Fulcrum is a product, of sorts, of the FDA’s increasing willingness to incorporate patient perspectives throughout the drug development process. Fulcrum reached out to patient groups to figure out which diseases to go after, even before the company was officially formed in 2016. That led it to FSHD. That approach is atypical; more often, drug developers connect with patient groups later on, Michael Tranfaglia, medical director, chief scientific officer, and co-founder of the FRAXA Research Foundation, told Xconomy in 2017.

Fulcrum has worked with the FSH Society, for instance, to obtain muscle tissue samples from people with the disease undergoing surgery as part of their treatment. The company has used those samples to grow muscle cells from the tissue and test its drug candidates against those cells. “It’s a unique relationship,” FSH Society president, CEO and co-founder Daniel Perez told Xconomy last year. (Fulcrum was a finalist for Xconomy’s patient partnership award in 2017.)

Gould says establishing relationships with the patient community has helped Fulcrum get its hands on those samples. The company has also teamed with patient advocacy groups to begin work on various studies, among them a “natural history” study in FSHD to better understand the disease’s trajectory. It’s working with patients to learn how the disease affects their quality of life and what types of benefits from a drug would be valuable. That insight, in turn, should help the company design clinical trials to answer questions that “speak directly to the patient’s needs and desires,” Gould says. And working with patient groups from the outset should help Fulcrum more quickly recruit patients for those studies.

“Just like they can educate us about what’s important for daily life, we can educate them about how vitally important tissue donation is to potentially identifying a therapy for a disease,” Gould says.

Fulcrum started up with a $55 million Series A in 2016 from Third Rock Ventures. The company is also developing drugs for sickle cell disease, Duchenne muscular dystrophy, and Fragile X syndrome.