Oruka's reverse merger unlocks $275M for chronic skin disease biologics
03 Apr 2024
Phase 2Acquisition
Oruka Therapeutics is making its biotech debut with a $275-million private investment and a move to go public via a reverse merger with ARCA biopharma. The all-stock transaction will see Oruka, the third company born out of Paragon Therapeutics, specialise in developing novel biologics for patients with chronic skin diseases.
"Launching Oruka with such strong investor support is a testament to the company's differentiated portfolio," said Evan Thompson, chief operating officer at Paragon, whose previous spinouts include inflammatory bowel disease-focused Spyre Therapeutics as well as immunology and inflammation company Apogee Therapeutics.
The private investment round was led by Fairmount and Venrock Healthcare Capital Partners, with participation from other backers such as Perceptive Advisors and Blackstone Multi-Asset Investing. The capital provides Oruka with a financial runway through 2027 to advance a pipeline centred on psoriasis and psoriatic arthritis, among other dermatologic and inflammatory indications.
Extended dosing intervals
It is also expected to fund its co-lead programmes, ORKA-001 and ORKA-002, through initial clinical proof-of-concept. The compounds, which target IL-23p19 and IL-17A/F, respectively, are expected to enter clinical trials in 2025. "We are committed to…developing potentially best-in-class biologics that could offer higher rates of complete disease clearance with as few as one or two doses a year," commented CEO Lawrence Klein
Oruka says both experimental drugs were designed using antibody engineering, including half-life extension, to allow for once- or twice-yearly dosing while at the same time offering better efficacy than conventional therapies.
Andrew Blauvelt, who chairs Oruka's scientific advisory board, recently shared data from the Phase II KNOCKOUT study at the American Academy of Dermatology (AAD) annual meeting assessing high induction dosing with AbbVie's IL-23 inhibitorIL-23 inhibitor Skyrizi (risankizumab) in treating plaque psoriasis.
That work "has demonstrated that stronger IL-23 inhibition can lead to higher response rates, with the potential for continued disease remissions without therapy. Oruka's lead programmes are uniquely suited to build upon this work," he said. Oruka also has a third undisclosed preclinical asset in its pipeline with a tissue-resident memory T-cell mechanism of action.
The reverse merger transaction is expected to close in the third quarter.
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