In a significant step up for Septerna, a fledgling biotech company, its successful initial public offering (IPO) garnered $288 million. This is a noteworthy achievement considering that Septerna recently entered the clinical stage and lacks human data, making it unique amongst this year’s biotech IPOs. Despite operating in a cautious market environment, the company has managed to leverage its cutting-edge technology, which stems from Nobel laureate research, and its promising lead drug candidate aimed at treating a rare, inherited disease.
Septerna’s IPO saw the company pricing its offering at $18 per share for 16 million shares, higher than its initial range, reflecting strong investor interest. Listed under the ticker “SEPN” on the Nasdaq, the company sets out to revolutionize treatment for hypoparathyroidism—an inherited deficiency of parathyroid hormone (PTH). This hormone plays a crucial role in regulating calcium and phosphate levels in the blood, and its deficiency can lead to serious symptoms like fatigue, brain fog, muscle weakness, and in severe cases, cardiovascular issues and renal failure.
Traditionally, hypoparathyroidism is managed with calcium and vitamin D supplements, which fail to address all symptoms. While an engineered hormone replacement option, Natpara by Takeda Pharmaceutical, will soon be discontinued due to manufacturing challenges, a new drug by Ascendis Pharma, Yorvipath, represents a fresh approach with injectable peptide drugs. However, Septerna distinguishes itself by developing SEP-786, a small molecule oral drug designed to activate the PTH1 receptor (PTH1R), thus offering a less burdensome, potentially more effective treatment option. The drug, which promises convenience and enhanced compliance, is currently undergoing clinical trials.
Septerna’s innovation is driven by its Native Complex technology platform, based on the pioneering GPCR research by Robert Lefkowitz, a 2012 Nobel Prize laureate. This platform allows the isolation and in-depth study of GPCRs—receptors crucial in a variety of physiological processes and diseases. Despite many FDA-approved drugs targeting GPCRs, about 75% of these receptors remain untapped targets. Septerna’s technology aims to change that by designing and optimizing small molecules that can effectively target these receptors.
The therapeutic potential of Septerna’s research is broad. Apart from SEP-786, the company has other candidates in its pipeline. SEP-631, a preclinical negative allosteric modulator, is being tested for immunology and inflammation, particularly for chronic spontaneous urticaria. The platform also yields potential treatments for metabolic disorders by targeting incretin receptors, positioning Septerna to compete with existing injectable peptide drugs by companies like Eli Lilly and Novo Nordisk, as well as oral medications under development.
Since its founding in 2019, Septerna has raised substantial funding from various rounds, amounting to $224.2 million before the IPO, with a notable Series B round led by RA Capital Management. As Septerna debuts in the public market, its largest shareholder remains Third Rock Ventures. Moving forward with the funds from the IPO, Septerna detailed plans to allocate $54 million for advancing SEP-786 through Phase 2 testing. An additional $24 million is earmarked for completing Phase 1 testing of SEP-631 and other related compounds. Furthermore, $41 million will be directed towards other research and development efforts, including projects targeting TSHR and incretin receptor programs.
In conclusion, Septerna’s emergence on the public market not only underscores its promising approach to treating hypoparathyroidism but also highlights its broader ambition in leveraging GPCR technology to address a variety of diseases. With robust financial backing and an innovative technological base, the company is poised to make significant advances in its clinical programs, aiming for transformative impacts in medical treatment fields.
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