GeneQuine Biotherapeutics Receives €9 Million Series A Financing

Hamburg/ Bonn — GeneQuine Biothe­ra­peu­tics GmbH, a biotech company deve­lo­ping gene therapy drugs for the treat­ment of muscu­los­ke­le­tal dise­a­ses, announ­ces the closing of a €5.4 million Series A finan­cing round and the raising of €3.65 million in conver­ti­ble loans and grants.

The Series A finan­cing round is led by Pacira BioSci­en­ces, Inc (Parsippany, USA), a US-based phar­maceu­ti­cal company focu­sed on pain manage­ment and rege­ne­ra­tive medi­cine. Other inves­tors include High-Tech Grün­der­fonds (Bonn), which has alre­ady inves­ted in GeneQuine, as well as Noshaq SA (Liège, Belgium) and Samum Vermö­gens­ver­wal­tungs GmbH (Hamburg). Pacira Biosci­en­ces, Inc. and Samum Vermö­gens­ver­wal­tungs GmbH also provide conver­ti­ble loans in the amount of €2.75 million. A further €0.9 million comes in the form of subsi­dies from the Inves­ti­ti­ons­bank des Landes Brandenburg.

GeneQuine will use the funds raised to deve­lop lead candi­date GQ-303 for the treat­ment of osteo­ar­thri­tis through to a Phase 1 clini­cal trial. Further­more, the deve­lo­p­ment of new gene therapy drugs for the treat­ment of inter­ver­te­bral disc dege­ne­ra­tion will be advan­ced, and GeneQuine’s gene therapy vector plat­form will be further expan­ded. GeneQuine alre­ady expan­ded its work­force last year and estab­lished a subsi­diary in Liège (Belgium). GeneQuine has its head­quar­ters in Hamburg and a rese­arch and deve­lo­p­ment labo­ra­tory in Lucken­walde (Grea­ter Berlin).

GeneQuine uses a gene therapy vector plat­form based on “Helper-depen­­dent Adeno­vi­ral Vectors” (HDAd) to trans­form tissues and organs affec­ted by dise­ase into “facto­ries” for local produc­tion of thera­peu­tic prote­ins. A single, local injec­tion of a gene therapy drug could thus lead to protein produc­tion over seve­ral years without the need for repea­ted appli­ca­tion requi­red for most conven­tio­nal drugs.

GQ-303 is an HDAd vector that produ­ces the protein proteo­gly­can 4 and is curr­ently in precli­ni­cal deve­lo­p­ment. Proteo­gly­can 4 (also known as lubri­cin) has been shown to have a dual mecha­nism of action in the treat­ment of osteo­ar­thri­tis: On the one hand, it has a biome­cha­ni­cal effect due to lubri­ca­ting proper­ties, and on the other hand, it has effects on mole­cu­lar mecha­nisms that lead to the inhi­bi­tion of pain, inflamm­a­tion and carti­lage dege­ne­ra­tion. Ther­e­fore, GQ-303 has the poten­tial to have both sympto­ma­tic and dise­ase-modi­f­y­ing effi­cacy in the treat­ment of osteo­ar­thri­tis, which has alre­ady been demons­tra­ted in seve­ral precli­ni­cal in vivo models.

GeneQuine is in advan­ced nego­tia­ti­ons with a suita­ble contract manu­fac­tu­rer for the produc­tion of GQ-303 for toxi­co­logy and clini­cal studies. Follo­wing produc­tion and formal toxi­co­logy studies with GQ-303, appr­oval for a Phase 1 clini­cal trial will be sought. GeneQuine’s former lead candi­date, an HDAd vector that produ­ces the protein interleukin‑1 (now refer­red to as FX201), was sold in 2017 to the phar­maceu­ti­cal company Flexion Thera­peu­tics, Inc. (Burling­ton, USA).

Flexion has since initia­ted a Phase 1 clini­cal trial and trea­ted multi­ple pati­ents in two dose groups with FX201. Because both GQ-303 and FX201 are HDAd vectors and both are injec­ted intra-arti­­cu­larly (directly into the joint), GeneQuine esti­ma­tes that most vector-rela­­ted deve­lo­p­ment risks for GQ-303 are mini­mi­zed. Although GQ-303 and FX201 are both being deve­lo­ped for knee osteo­ar­thri­tis, GeneQuine will focus on a speci­fic pati­ent popu­la­tion with GQ-303 that can poten­ti­ally bene­fit most from the dual mecha­nism of action of proteo­gly­can 4.

GeneQuine is also deve­lo­ping HDAd vector-based gene therapy drugs for the treat­ment of disc dege­ne­ra­tion. Despite the very high unmet medi­cal need in the treat­ment of disc dege­ne­ra­tion — one of the main causes of chro­nic low back pain — no dise­ase-modi­f­y­ing drugs are available for this indi­ca­tion. GeneQuine’s data show that gene therapy with HDAd vectors has great poten­tial in the deve­lo­p­ment of sympto­ma­tic and dise­ase-modi­f­y­ing drugs for this disease.

“We are very plea­sed to have closed this finan­cing round and will now use the capi­tal effi­ci­ently to bring GQ-303 into the clinic, expand our gene therapy program for the treat­ment of disc dege­ne­ra­tion, and expand our HDAd vector plat­form. We would like to thank all inves­tors in this finan­cing round for their trust and support. In parti­cu­lar, we are plea­sed to have Pacira as an inves­tor with their strong exper­tise in clini­cal drug deve­lo­p­ment in the muscu­los­ke­le­tal field,” Kilian Guse, CEO of GeneQuine (photo).

“Our equity invest­ment in GeneQuine repres­ents a signi­fi­cant oppor­tu­nity to parti­ci­pate in the deve­lo­p­ment of what we believe is an exci­ting dise­ase-modi­f­y­ing gene therapy for osteo­ar­thri­tis. GeneQuine is conduc­ting precli­ni­cal work to support the initia­tion of human studies in appro­xi­m­ately two years. In addi­tion to our confi­dence in this tran­sac­tion as a sound invest­ment, we enthu­si­a­sti­cally look forward to the matu­ra­tion of data and for further oppor­tu­nity to parti­ci­pate in GeneQuine’s successful precli­ni­cal program and entry into the clinic. Importantly, this invest­ment is consis­tent with our mission to advance inno­va­tive pain manage­ment and rege­ne­ra­tive health solu­ti­ons,” Ron Ellis, Senior Vice Presi­dent, Corpo­rate Stra­tegy and Busi­ness Deve­lo­p­ment at Pacira.

“GeneQuine is a great exam­ple of a typi­cal HTGF invest­ment: a new gene­ti­cally engi­nee­red drug disco­very plat­form that broke comple­tely new scien­ti­fic ground when we made our seed invest­ment in 2012. That combi­ned with a strong team capa­ble of advan­cing gene therapy agents toward the clinic as effi­ci­ently as possi­ble. We look forward to support­ing GeneQuine toge­ther with the inter­na­tio­nal inves­tor consor­tium and Pacira’s exper­tise in deve­lo­ping their promi­sing pipe­line,” Martin Pfis­ter, Prin­ci­pal at High-Tech Gründerfonds

About GeneQuine Biothe­ra­peu­tics GmbH

GeneQuine Biothe­ra­peu­tics GmbH is a biotech company deve­lo­ping inno­va­tive gene therapy drugs for the treat­ment of muscu­los­ke­le­tal dise­a­ses. GeneQuine uses a gene therapy plat­form to turn tissues and organs affec­ted by dise­ase into “facto­ries” for local produc­tion of thera­peu­tic prote­ins. Lead candi­date GQ-303 is being deve­lo­ped as a topi­cally applied drug for the treat­ment of osteo­ar­thri­tis and has shown great poten­tial to have sympto­ma­tic and dise­ase-modi­f­y­ing effi­cacy in multi­ple animal models. GeneQuine’s former lead candi­date for the treat­ment of osteo­ar­thri­tis, which is based on the same gene therapy vector tech­no­logy as GQ-303, was sold in 2017 to phar­maceu­ti­cal company Flexion Thera­peu­tics, Inc. (Burling­ton, USA) and is curr­ently being tested in a Phase 1 clini­cal trial. GeneQuine has a head office in Hamburg and branch offices in Lucken­walde (Grea­ter Berlin) and Liège (Belgium). www.genequine.com

About High-Tech Gründerfonds

The seed inves­tor High-Tech Grün­der­fonds (HTGF) finan­ces tech­no­logy start-ups with growth poten­tial. With a volume of around EUR 900 million spread across three funds and an inter­na­tio­nal part­ner network, HTGF has supported almost 600 start-ups since 2005. His team of expe­ri­en­ced invest­ment mana­gers and start-up experts supports the young compa­nies with know-how, entre­pre­neu­rial spirit and passion. The focus is on high-tech start-ups in the fields of digi­tal tech, indus­trial tech, life scien­ces, chemis­try and rela­ted busi­ness areas. Over €2.8 billion in capi­tal has been inves­ted in the HTGF port­fo­lio by exter­nal inves­tors in more than 1,600 follow-on finan­cing rounds to date. In addi­tion, the fund has alre­ady successfully sold shares in more than 100 companies.