AI Drug Discovery Firm Healx, Co-Founded by 'Father of Viagra,' Secures $47M Series C After 45% Workforce Reduction

Aug 02, 2024 18:44 CST Updated 18:44

Healx

Drug Discovery Platform Developer

Healx is a British start-up that uses artificial intelligence to develop new drugs for the treatment of rare diseases. Recently, Healx announced that it has received$47 Million Series CFinancing.

This round of financing was led by Atomico and Silicon Valley R42, with other investors including Balderton, Jonathan Milner, Global Brain, btov, Ayana Capital, o2h, and VU Venture Partners.

It was revealed that last year, Healx implemented a series of initiativesLayoffs 45%，with a total of about 70 people. This year, the company has finally turned the corner and secured Series C financing.

However, with the market environment yet to recover, the Series C financing round was far less than what the company had previously anticipated. In response,Healx also made a series of responses.

Founded by the inventor of Viagra

Healx was founded in 2014 by David Brown and Tim Guilliams.

Tim Guilliams holds a Ph.D. in Biophysics and Neuroscience from the University of Cambridge, while David Brown has over 40 years of experience in drug research and development, having served as the Global Head of Research and Development at Roche and being the inventor of the Viagra (Sildenafil) patent for Pfizer.

Fig: Healx Co-Founders Tim Guilliams and David Brown.

Healx's AI drug discovery platform integrates a vast amount of public and proprietary data sources (such as biomedical literature, disease and biochemical datasets, clinical trials, and patents) into"Biomedical Knowledge Graph"。

Subsequently, the AI platform can identify hidden connections between existing compounds (such as drugs and medicines at various stages of the development cycle) and rare diseases, improving R&D efficiency.

Then, the effectiveness of the drug will be tested by Healx's scientists in the laboratory, and ultimately, the drug will be advanced to clinical trials.

Today, Healx has approximately55 Employees, about half of whom are responsible for areas involving machine learning or computational biology. The other half are the clinical and pharmacology teams, who "work closely with the technical staff."

Although the majority of the company's team members are in Cambridge, UK, the company is currently seeking to expand its operations in the United States, with its clinical trials set to begin in the US in December.

Before this round of financing, Healx had raised about 68 million US dollars, most of which came from a 56-million-US-dollar B-round financing in 2019.

Notably, Healx's Series C funding round was $9 million less than its Series B round five years ago.

A person familiar with the matter said,Healx's initial vision for its Series C funding round was far more than $47 million, but the final amount raised fell short due to an economic downturn and macroeconomic reasons.

This insider also revealed:The company also reduced its workforce by about 45% — approximately 70 employees — last year through a series of voluntary and mandatory layoffs.

The company responded: Due to the smaller scale of clinical trials for rare diseases, the company has already secured the necessary funding to advance the drug. Since the last round of financing, the company's valuation has increased.

The proceeds will be used to advance the company's drug development in rare tumors, kidney, and neurodevelopmental disorders, including advancing its lead program HLX-1502 through Phase 2 clinical trials for the treatment of Neurofibromatosis type 1 (NF1).

The drug has been approved for Phase II clinical trials.

The drug that the company is currently advancing the fastest isHLX-1502, which received FDA approval not long ago, will begin the second phase of clinical trials in the United States later this year.

HLX-1502 is an oral medication, distinct from other NFI treatments. The drug has received FDA Orphan Drug and Rare Pediatric Disease designations for the treatment of NF1 (Neurofibromatosis Type 1).

The drug originated from Healx's platform, and although its initial indication was not for NF1, Healx has applied for and owns the patent for HLX-1502, which is specifically intended for treating NF1 and "other neuro-related conditions." The FDA has also granted it exclusivity for new drug products in the U.S. market.

NF1 is an autosomal dominant genetic disorder caused by mutations in the NF1 gene, affecting approximately 1 in 2,500 people, with symptoms including café-au-lait spots and tumors in neural tissues, persisting throughout life.

Fig: Healx's R&D Pipeline

Healx claims its effect is different from other NFI treatments. The drug has received FDA orphan drug and rare pediatric disease designations for the treatment of NF1.

The company has also signed an investment agreement with its long-term research partner, the Children's Tumor Foundation (CTF). Under the terms of the agreement, Healx will receive milestone payments from CTF to advance drug projects, including HLX-1502.

According to the company's internal business analysis, Healx stated that the drug has$16 billion market size, because if HLX-1502 is effective for NF1, then it is likely to be effective for other neuro-related diseases as well.

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