Karuna Therapeutics Secures $80M Series B Financing to Advance Muscarinic-Targeted Therapy for Psychiatric Disorders

VCBeat (WeChat Official Account: vcbeat) learned from foreign media that on April 1, U.S. local time, biopharmaceutical company Karuna Therapeutics completed an $80 million Series B financing round. The funds from this round will be used to advance the development of drugs for psychiatric disorders by Karuna Therapeutics and to enhance the company’s infrastructure.

It is reported that this round of financing was jointly invested by Sofinnova Investments, ARCH Venture Partners, Partner Fund Management, and others.

Karuna Therapeutics is a subsidiary of PureTech Health. Under the leadership of Chairman and Chief Executive Officer Steve Paul, Karuna Therapeutics is dedicated to developing novel therapies that address the disabling aspects of neuropsychiatric disorders. Currently, the company is conducting a Phase 2 clinical trial of KarXT for schizophrenia, targeting acute psychosis in patients with schizophrenia, with initial results expected in late 2019. The company also plans to initiate clinical trials targeting the central nervous system to evaluate the potential efficacy of KarXT in other central nervous system disorders.

KarXT is a muscarinic acetylcholine receptor modulator composed of xanomeline (a novel muscarinic acetylcholine receptor agonist) and trospium chloride (a well-established muscarinic receptor antagonist that has been shown not to cross the blood-brain barrier and has received FDA approval).

Muscarinic receptors in the nervous system bind to acetylcholine (a neurotransmitter). Five types of muscarinic receptors (M1–M5) are expressed in the brain, while M2 and M3 receptors are also expressed peripherally outside the brain, such as in sweat glands, salivary glands, and the gastrointestinal (GI) tract. Activation of peripheral muscarinic receptors can cause side effects (e.g., GI adverse events), which may exacerbate psychiatric disorders. Previously, therapeutic agents entering the central nervous system often triggered activation of peripherally expressed muscarinic receptors, leading to side effects. KarXT represents a novel approach specifically designed to overcome these issues, offering the potential to deliver muscarinic receptor activation in ways not achievable with current technologies.

“We thank all investors for their support as we work together to develop and deliver new therapies for patients with neuropsychiatric disorders,” said Dr. Steve Paul, Chairman and Chief Executive Officer of Karuna Therapeutics. “This financing will enable our team to further explore treatment options for psychiatric diseases.”

Sofinnova was founded in 1974 as the U.S. subsidiary of Sofinnova Partners, headquartered in Paris. In 1997, the two companies split into independent entities: Sofinnova Ventures in the United States and Sofinnova Partners in France. In 2007, Sofinnova Ventures further refined its investment strategy to focus on private biopharmaceutical companies. In 2019, Sofinnova Ventures was renamed Sofinnova Investments to distinguish between public and private investment strategies within the biopharmaceutical sector. Today, Sofinnova Investments manages approximately $1.8 billion in assets and committed capital, with offices located in California.

ARCH Venture Partners primarily invests in companies co-founded by leading scientists and entrepreneurs, dedicated to bringing innovations in life sciences, physical sciences, and information technology to market. ARCH Venture Partners currently manages seven funds with total assets under management of nearly $1.5 billion.

Partner Fund Management is an investment management firm specializing in strategic investments in global healthcare.

(Compiled by Liu Yujing)