Lilly-backed OrsoBio secures $67M for obesity drug portfolio

California biotech startup OrsoBio is positioning itself at the forefront of obesity treatment through innovative combination approaches. The company recently secured $67 million in a Series B financing round, following a $60 million Series A raised just ten months prior. This infusion of capital is set to propel OrsoBio's ambitious plans forward, attracting attention from potential acquirers, partners, and investors within the competitive obesity research and development landscape.

New backers for this round include Ascenta Capital and Woodline Partners, while returning investors comprise Samsara Biocapital, Longitude Capital, Enavate Sciences, NuevaBio, and Eli Lilly. These investors are particularly interested in OrsoBio’s potential to emerge as a leading player in the next generation of obesity biotech. The focus is on combining their innovative medicines with the well-established GLP-1 class developed by Novo Nordisk and Lilly.

OrsoBio, which initially started as The Liver Company in 2020, is a fusion of assets from Gilead, Shionogi, Phenex, and Astellas. The company's two principal clinical programs are currently in Phase 2a trials for patients with type 2 diabetes and severe hypertriglyceridemia and MASH. However, these projects are no longer the primary focus. Instead, the latest funding will support the development of a new portfolio of mitochondrial protonophores, according to CEO Mani Subramanian.

This experimental class of drugs aims to boost energy expenditure rather than merely suppressing appetite, as the GLP-1 drugs do. Leading this new class is TLC-6740, an asset derived from Gilead, which is currently undergoing early-stage trials in New Zealand and has recently received FDA clearance for clinical testing. The company plans to initiate further Phase 1b and Phase 2a trials of this oral, liver-directed drug in patients with obesity and type 2 diabetes in the near future.

Subramanian emphasized the potential of these new therapies, highlighting the significant advancements in incretin mimetic therapies. He sees a substantial opportunity for complementary mechanisms that can address unmet needs within the obesity treatment space. Following TLC-6740 in the pipeline are two additional mitochondrial protonophores. One of these, TLC-1180, is a long-acting asset that may be developed as a weekly oral treatment or an under-the-skin drug. TLC-1180 is expected to enter clinical studies by mid-2025. The second, TLC-1235, is a controlled-release asset, with both drugs set to undergo IND-enabling studies shortly.

Regarding their existing type 2 diabetes and MASH/hypertriglyceridemia programs, Subramanian noted that their continuation would depend on upcoming data readouts and the considerable resources required for these indications. The company anticipates receiving data in November or December, which will determine whether these assets will be advanced internally or through partnerships.

With the obesity market drawing sustained interest from both investors and pharmaceutical companies, OrsoBio’s future could unfold in various directions. The 15-employee company might pursue an IPO, similar to BioAge and other metabolic firms, or it could be acquired, as seen with companies like Carmot, Versanis, and Inversago in the past year.

Subramanian stated that the company remains flexible and open to all possible paths, based on the quality and interest in their generated data and prevailing market conditions. He also pointed out the significant pharma interest, particularly due to the complementary nature of OrsoBio’s work to the incretin space and the broader interest in weight management and associated comorbidities.