Rheostat Therapeutics Secures $23 Million Series A Financing to Advance Autophagy-Modulating Small Molecule Therapies for Neurodegenerative and Rare Diseases

VCBeat (WeChat ID: vcbeat) has learned from foreign media that on November 26, 2018, U.S. local time, Rheostat Therapeutics (hereinafter referred to as “Rheostat”), a biotechnology company based in Cambridge, Massachusetts, announced the completion of a $23 million Series A financing round. Rheostat is dedicated to developing novel therapies for neurodegenerative diseases, cognitive disorders, and rare diseases. The newly raised capital will primarily be used to advance its R&D-stage candidates into clinical trials, support biomarker research, and help the company build out its team.

This round of financing was co-led by MRL Ventures Fund (hereinafter referred to as “MRLV”) and AbbVie Biotech Ventures, with participation from Amgen Ventures, Alexandria Venture Investments, Mayo Clinic, as well as Rheostat’s existing investors Health Investors and Dementia Discovery Fund. Following this financing round, Reza Halse, President of MRLV, and John Gustofson, Managing Director of AbbVie Ventures, will join Rheostat’s Board of Directors. Details of previous financing rounds have not been disclosed.

Under the leadership of Chairman and Interim CEO Joshua Resnick, Rheostat is dedicated to research on small molecules that modulate autophagy. Autophagy refers to the process by which cells remove unnecessary substances from the body, such as proteins, cellular components, and pathogens. Meanwhile, Rheostat is also investigating new therapies for neurodegenerative diseases by modulating mitophagy. Its core thesis is that the degradation of toxic cellular components represents a fundamental node in biology, and impaired mutations in these clearance pathways are associated with various neurodegenerative diseases, including cognitive disorders such as Parkinson’s disease. The company is striving to leverage its understanding of these pathways to discover and develop novel small molecules aimed at restoring cellular homeostasis and improving treatment outcomes for patients with neurodegenerative and rare diseases.

Rheostat is a startup incubated by SV Health Investors and the Dementia Discovery Fund. Its successful Series A financing round was also bolstered by its strong founding team.

Its current team members include Chairman and Interim CEO Joshua Resnick, and Chief Scientific Officer Magdalene Moran.

Among them, Joshua Resnick also serves as a Partner at SV Health Investors. Previously, he served on the Board of Directors of CoStim Pharmaceuticals, which was acquired by Novartis in February 2014. Meanwhile, Joshua Resnick is an Attending Physician in the Department of Emergency Medicine at Brigham and Women's Hospital and a Lecturer at Harvard Medical School.

Rheostat is not the first company dedicated to autophagy research. In May of this year, Casma Therapeutics (hereinafter referred to as “Casma”), a biotechnology company also based in Cambridge, Massachusetts, invested $58.5 million to develop a new product engine.

According to the company, this product can identify and validate targets that induce autophagy at different stages and link them to various diseases. Previously, the company had not explicitly disclosed the indications for this product but stated that it was considering lysosomal storage disorders and neurodegenerative diseases. To date, the company has raised a total of $58.5 million in its Series A financing round.

Rheostat, headquartered in Cambridge, Massachusetts, is an early-stage biotechnology company dedicated to developing novel therapies for neurodegenerative diseases by modulating mitochondrial autophagy.

MRLV, based in Cambridge, Massachusetts, is an independent early-stage biotherapeutics venture capital fund under Merck. The firm primarily invests in seed and early-stage companies grounded in translatable, breakthrough science.

AbbVie Biotech Ventures, established in 2013 and headquartered in Illinois, USA, primarily invests in early-stage emerging biotechnology and pharmaceutical companies.