The field of depression treatment urgently needs innovation. Although there are many investigational drugs in the biopharmaceutical pipeline, years of repeated failures have prevented major breakthroughs in this field.

According to data from the Pharmaceutical Research and Manufacturers of America (PhRMA), as of January 2023, the industry had a total of163 psychiatric disorder candidate drugs, of which 54 targeted depression. Despite numerous attempts, few have succeeded.

For example, the depression treatment drug developed by Sage Therapeutics in collaboration with Biogen,Zurzuvae,failed to gain approval for the indication of major depressive disorder (MDD), the most common type of depression, and is currently only approved for treating postpartum depression. Over the past 20 years, despite the enormous unmet needs in many psychiatric disorders, psychiatric drugs have been largelyoverlooked. According to the World Health Organization (WHO), depression affects approximately280 million people。

Among the many biopharmaceutical companies seeking novel therapies for depression, San Diego-based Autobahn Therapeutics has attracted significant attention. The company currently has a candidate drugin the clinical stage, targeting both MDD and bipolar depression. Its lead candidate, ABX-002, is a selective thyroid hormone beta receptor agonist and is about to enter Phase II clinical trials for both indications.

Since its founding in 2020, Autobahn has raised substantial funds. Last month, the company completed a $100 million Series C financing round, with investors including major institutions such as Biogen, Bristol Myers Squibb, and Pfizer Ventures. Prior to the Series C round, Autobahn had already raised $125 million from the same pharmaceutical giants and other venture investors. Autobahn has also been listed as abiotech company to watch, with potential for a future IPO. The company's repeated successful fundraising highlights the strong interest of large pharmaceutical companies in solutions to conquer MDD.

Autobahn stated that the newly injected funds will help advance its Phase II clinical trials. In this context, we interviewed Autobahn's President and CEO, Kevin Finney, via email to discuss how the company managed to attract renowned investors while the biotech investment market is still in the recovery phase after years of stalled growth.

Positioning of ABX-002 in the current treatment landscape for MDD and bipolar depression

Kevin Finney:There is a huge unmet need in MDD and bipolar depression, driven in large part by the lack of treatments that are safe, well-tolerated, and provide clinically meaningful improvements for patients. More than half of depression patients do not respond adequately to [selective serotonin reuptake inhibitors]. These existing treatments... often come with troubling side effects, fail to address symptoms that are prevalent in depression, and force patients to discontinue treatment.

The brain bioenergetic mechanism on which ABX-002 is based is believed to be uniquely positioned to treat atypical depression, a highly prevalent subtype of depression. This subtype accounts for approximately 35% of all MDD patients and 50% of bipolar depression patients, and there are currently no approved therapies targeting this subtype.

Our Phase I studies showed that ABX-002 demonstrated good safety and tolerability in healthy volunteers, and its profile suggests the drug has the potential to avoid the major side effects of existing treatments... such as weight gain, sexual dysfunction, dissociation, and somnolence.

Market potential of ABX-002

More than 21 million people in the United States have MDD, and another approximately 7 million have bipolar depression. Despite significant tolerability issues and modest efficacy of existing approved therapies, some of them, as adjunctive treatments for depression, still generate annual revenues of $1 billion or more. We believe that, given the substantial need ABX-002 could fill in MDD, bipolar depression, and the atypical depression subgroup, its target profile has the potential to achieve similar commercial success.

Current biotech investment environment

It is no secret that the capital markets environment has been challenging for biotech companies of all sizes over the past few years. Despite these headwinds, investors focused on long-term value creation continue to support programs with solid biology and clinical rationale in areas of unmet need, and with a clear path to value inflection points. We are very fortunate to have the support of these investors... With this Series C round complete, our focus is on executing the clinical strategy supported by this financing.

Winning early investors in an environment of repeated setbacks in neuroscience

Investors quickly recognize the enormous unmet need in neuropsychiatric medicine. As a result, many investors are actively supporting companies in the MDD and bipolar depression space and want to understand the steps we are taking to de-risk the development path for ABX-002. This includes our characterization of the preclinical pharmacology profile, as well as Phase I safety data in healthy volunteers. Investors are also interested in how we are thinking about de-risking the Phase II clinical studies in MDD and bipolar depression, covering aspects such as study design, the endpoints used, and the nature of the patient populations studied. Ultimately, we aim to articulate to investors the data and rationale supporting each of our development decisions to increase the probability of success in future clinical studies.