Just days after Krystal Biotech’s groundbreaking approval for its first product, Vyjuvek, the company has raised an estimated $160M through a private placement (PIPE).
Vyjuvek (beremagene geperpavec, or B-VEC) is the first-ever redosable gene therapy for treatment of dystrophic epidermolysis bullosa (DEB), the second most common cause of this agonizing skin blistering disease. An estimated 6,000 to 9,000 people have this very rare disease worldwide, and the market is expected to be worth approximately $750M over the next few years.
The PIPE financing was led by Avoro Capital Advisors and Redmile Group, LLC with participation from Braidwell LP and Frazier Life Sciences.
“We are extremely pleased to have the support of this strong investor group,” said Krish S. Krishnan, Chairman and CEO of Krystal Biotech, Inc. “These additional funds, together with our existing cash, cash equivalents and investments, should allow us to fund the Vyjuvek launch, future operations, and the advancement of our growing pipeline through the end of 2026.”
Redosable gene therapies can be titrated according to the needs of individual patients. They are designed to overcome the immunogenicity associated with single dose viral-vector gene therapies, the side effects of which limit the number of patients that can be treated.
DEB affects the skin and mucosal tissues and is caused by one or more mutations in the COL7A1 gene, resulting in lack of production of functional type VII collagen (COL7) protein. VYJUVEK is a topical gel that addresses the genetic cause of DEB by restoring functional copies of the COL7A1 gene to patients and is the only medicine available for patients in the U.S.
“Data from our GEM-1/2 trial and our GEM-3 trial, published in Nature Medicine and the New England Journal of Medicine, respectively, demonstrated the strength of both studies showing that VYJUVEK safely and effectively improved wound healing,” said Suma Krishnan, President, Research & Development, Krystal Biotech, Inc. “For so many years, all we have been able to offer DEB patients was palliative care, but now, based on the strength of the Company’s clinical trial data, there is a safe and effective FDA approved treatment.”
Data from the pivotal Phase III GEM-3 trial demonstrated that the trial met its primary endpoint of complete wound healing at six months and its key secondary endpoint of complete wound healing at three months. In that study, wounds were exposed to the treatment (B-VEC) or placebo in 31 patients. At six months, complete wound healing occurred in 67% of those who received B-VEC as compared with 22% of those exposed to placebo.
Krystal’s pipeline includes drug candidates for transglutaminase 1 (TGM1)-deficient autosomal recessive congenital ichthyosis (ARCI), Netherton syndrome, cystic fibrosis, and alpha-1 antitrypsin deficiency. All these other projects are in preclinical or earlier phases, except for KB105, the TGM1- deficient ARCI treatment.
The company plans to initiate a Phase II cohort of its KB105-02 (JADE-1) trial in the first half of 2023. This trial will enroll both pediatric and adult patients with TGM1 deficient ARCI.
As part of the Vyjuvek’s approval, Krystal also received a priority review voucher that it can use for another candidate or sell. These vouchers sell for as much as $100M.