With $104M series C debut, Encoded takes on expansion of gene therapies

Encoded emerges from stealth with $104M series C and technology to fine-tune where and how gene therapies are expressed

Encoded wants to fine-tune expression of gene therapies, and expand the indications and targets for which they can be used, taking the technology beyond the limits set by payload size.

Emerging from stealth with a $104 million series C round on Wednesday, Encoded Therapeutics Inc. has unveiled its platform to identify tissue- and cell type-specific regulatory DNA sequences, which it incorporates into gene therapies to precisely control their expression. Encoded can also use the regulatory sequences as targets for gene therapies, controlling expression of target proteins in situ.

Backed by a broad syndicate of investors, with Sean Nolan as chairman, the company has both the funding and experience to challenge the flood of companies moving into gene therapies. Nolan was president and CEO of AveXis Inc. until its acquisition by Novartis AG.

CEO Kartik Ramamoorthi, who founded the company with CSO Stephanie Tagliatela in 2014, said that because most gene therapies’ payloads are expressed constantly at high levels, many indications are out of bounds because of toxicity concerns, in particular in off-target tissues.

For example, CNS diseases often require precise control of tissue distribution.

Delivery of genes too large for AAVs has also been out of reach.

Encoded’s first indication is Dravet syndrome, which is caused by deficiency in Nav1.1, a sodium channel encoded by a gene too large for AAV delivery, at about 3.6kb without introns.

Encoded’s product delivers an undisclosed protein that binds Nav1.1’s regulatory DNA to boost its expression. In addition, the expression of the gene payload is controlled by regulatory DNA that limits expression to the target cell type.

Menlo Ventures’ Greg Yap pointed to the disease as an example of one where treatment is symptomatic, and that has defied gene therapies.

Stoke Therapeutics Inc. is also developing a disease-modifying therapy for Dravet. It has an antisense oligo against mutant Nav1.1 in preclinical testing, that CEO Ed Kaye told BioCentury in December would likely need 2-3 annual intrathecal injections (see “Stoke Unveils Dravet Data that Supported $90M Series B”).

Ramamoorthi believes Encoded’s Dravet syndrome gene therapy will require just one administration.

According to Ramamoorthi, attempts to optimize gene therapies have focused on vector capsids, which are key in directing which cells and tissues the virus infects.

Encoded uses clinically validated vectors, and because its platform is based on genomics, Tagliatela said it is “agnostic to the gene delivery vector.” She said the company can leverage the same regulatory elements across different serotypes and different viral vectors.

Ramamoorthi said the company has focused on optimizing the levels and tissue patterns induced by specific human regulatory DNA elements.

The technology allows in vivo screening of a library of the DNA sequences simultaneously in a single AAV vector to determine how much and how far different regulatory elements influence gene expression across multiple tissue and cell types.

Encoded has filed patent applications covering its IP, all developed internally. Ramamoorthi said the IP portfolio covers the platform technology as well as products for indications including the lead program in Dravet syndrome.

Arch’s Robert Nelsen, who is on Encoded’s board, told BioCentury the company’s "ability to systematically design ways of targeting specific cell types" is especially attractive.

Tagliatela said the mouse data Encoded presented at the American Society of Gene & Cell Therapy (ASGCT) meeting in May showed that a single administration of the Dravet therapy led to Nav1.1 expression in only the targeted cells, reversed disease-associated seizures and reduced mortality. Encoded hopes to begin clinical testing in early 2021.

Ramamoorthi said the series C will enable the company to start clinical testing for Dravet syndrome and advance its other programs toward the clinic. Aside from Dravet syndrome, specific indications are undisclosed but fall into neurology, including neurodegeneration; hepatic and metabolic disease; and cardiovascular diseases.

Ramamoorthi said the company intends to independently drive its products through completion of clinical trials.

The series C syndicate comprised all the company’s existing investors -- Venrock, Arch Venture Partners, Matrix Capital Management, Illumina Ventures and Altitude Life Science Ventures -- and new investors Menlo Ventures, RTW Investments, Boxer Capital and Alexandria Venture Investments.

COMPANY PROFILE

Encoded Therapeutics Inc.

South San Francisco, Calif.

Technology: Regulatory gene expression platform for gene therapies

Disease focus: Neurology, cardiovascular, hepatic and endocrine/metabolic

Clinical status: Preclinical

Founded: 2014 by Kartik Ramamoorthi and Stephanie Tagliatela

University collaborators: N/A

Corporate partners: N/A

Number of employees: 50

Funds raised: $158 million

Investors: Venrock, Arch Venture Partners, Matrix Capital Management, Illumina Ventures, Altitude Life Science Ventures, Menlo Ventures, RTW Investments, Boxer Capital and Alexandria Venture Investments

CEO: Kartik Ramamoorthi

Patents: None issued

Companies and Institutions Mentioned

Encoded Therapeutics Inc., South San Francisco, Calif.

Novartis AG (NYSE:NVS; SIX:NOVN), Basel, Switzerland

Stoke Therapeutics Inc. (NASDAQ:STOK), Bedford, Mass.

Targets

Nav1.1 (SCN1A) - Sodium voltage-gated channel α subunit 1

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