The company’s announcement also included the issuance of $22m in shares upon conversion of debt into equity
Participants included ARCH Venture Partners, the Wellcome Trust, Steven Paul M.D., PureTech Health, and other undisclosed investors.
Karuna plans to use the proceeds from the financing to advance its lead product candidate, KarXT (Karuna-xanomeline-trospium chloride), including the initiation of a Phase 2 trial in patients with schizophrenia in the third quarter of 2018 and the expansion into other therapeutic areas, including a non-opiate pain indication.
ARCH Venture Partners co-founder and managing director Robert Nelsen said: “Karuna has all of the characteristics we look for in a game-changing CNS company. Its lead drug candidate has a unique mechanism of action for treating both psychosis and cognition, as well as an exciting non-opiate application for pain.
“These are therapeutic indications where there is a profound need for new treatments. We are excited about the clinical data that have already been generated, and we look forward to helping to drive the next chapter of growth.”
KarXT is designed to improve tolerability and unlock the potential of muscarinic cholinergic receptor agonists that selectively target M1/M4 muscarinic cholinergic receptors in the brain while blocking their activation in tissues outside the brain.
Karuna is currently completing a second Phase 1 trial using a proprietary co-formulation of xanomeline, a muscarinic agonist Karuna exclusively licensed from Eli Lilly which showed compelling efficacy in patients with schizophrenia and Alzheimer’s disease but had peripheral cholinergic side effects, combined with trospium chloride, a muscarinic antagonist that acts only in the periphery (outside of the brain and central nervous system).
The initial Phase 1 trial demonstrated a significant and clinically meaningful reduction in pre-specified cholinergic side effects with KarXT compared to xanomeline alone.
The Phase 2 trial in patients with schizophrenia is designed to replicate and expand on previous efficacy and safety data with xanomeline in schizophrenia and Alzheimer’s disease.
Karuna co-founder and CEO Andrew Miller said: “We greatly appreciate the support of our investors and their confidence in the potential of KarXT to be the first new and highly differentiated medicine in over 50 years for the treatment of psychosis and cognitive impairment in psychiatric and neurological disorders.
“We believe KarXT could be a promising new treatment that safely and effectively addresses the debilitating positive, negative, and cognitive symptoms of patients living with schizophrenia and other central nervous system disorders.”
Source: Company Press Release