Comments from Orphazyme on the investment in CombiGene
Orphazyme has acquired 10 per cent of the shares in CombiGene, making the Danish investment company one of the largest shareholders. BioStock reached out to Orphazyme’s Chairman of the Board Michael Hove and CombiGene’s CEO Peter Ekolind to learn more about the reasons for the investment.
CombiGene made the headlines in 2021 when it out-licensed its epilepsy project CG01 to US-based gene therapy company Spark Therapeutics, following a series of convincing preclinical data.
According to the agreement, CombiGene was eligible to receive up to USD 328.5 million excluding royalties, with 8.5 million USD upon signing, as well as up to USD 50 million at several preclinical and clinical milestones. In January 2024, CombiGene regained the global rights to CG01 after the collaboration agreement was terminated due to a strategic audit of Spark’s pipeline. CombiGene is now scouting for a new licensee for the project.
CG01 is not CombiGene’s sole asset. In early 2023, CombiGene entered into a collaboration with the Danish biotech company Zyneyro to develop more effective treatments for severe chronic pain conditions. The joint pipeline includes the most advanced project – the peptide treatment COZY01 – as well as the gene therapy treatment COZY02.
Comments from Orphazyme on the investment
Recently, CombiGene announced that the Danish investment company Orphazyme has acquired more than 10 per cent of the outstanding shares in CombiGene. According to Holdings, this makes Orphazyme the biggest shareholder in the company.
BioStock reached out to Michael Hove, Chairman of the Board of Orphazyme, and Peter Ekolind, CEO of CombiGene, to get a background for the investment.
Michael, eight years ago, Orphazyme was listed on Nasdaq Copenhagen, and in May 2022, all biotechnology assets were sold in favour to focus on biopharmaceutical investments. Can you briefly discuss this transition?
– Orphazyme was founded in Denmark in 2009 on a scientific discovery regarding the role of heat shock proteins (HSPs), which was described in a well-cited article published in the journal Nature.
– In 2017, the company was listed at Nasdaq Copenhagen where over the coming years was able to attract various industrial investors (IE. Novo Holding as majority shareholder) and due to promising clinical data able to raise more than EUR 350 million to go in full scale on finalizing their main product Arimoclomol in all clinical stages internally and ready to launch also on the US market. In February 2022 the clinical data failed in phase III and that initiated a 180 degree turnaround of the company which ended in May 2022 when the company sold all assets and business activities, including those relating to the development and approval of arimoclomol to KemPharm Denmark A/S, a wholly owned subsidiary of KemPharm, Inc. for approximately USD 12.8 million in cash and then it was in the process of redefining its strategy.
– I took over the chairmanship in May 2023 with a new board and accelerated the clean-up of the company, recapitalizing and in January we presented our new strategy which would be to buy strategic positions in early-stage biotech companies and add value to the partnership through our competencies in the board. CombiGene is the first investment in the new strategy from January 2024.
Why are Orphazyme investing in CombiGene, and why right now?
– When we monitored the Nordic market CombiGene was unique both regarding its long history in gene therapy with CG01 as the front runner, and also because they succeeded in signing a strategic partnership with Spark, which we consider as proof of concept. We have high expectations that the company will succeed in finding a new partner that will take the promising product all the way to product launch, and also look forward to following the two projects which are launched in cooperation with the Danish biotech company Zyneyro to develop more effective treatments for severe chronic pain conditions.
Peter, what are your comments on the investment made by Orphazyme?
– We are pleased to welcome Orphazyme as a lead investor with the ambition to join the growth journey that CombiGene strive for by developing existing assets and in-licensing new ones to develop further. I believe that Orphazyme can contribute with valuable knowledge and experience to the company.
According to your recent press release, CombiGene’s Board of Directors have begun a dialogue with Orphazyme. Can you discuss the specifics of these discussions?
– It is a bit early to elaborate at this point as the dialogue is just beginning. I will certainly have more to disclose later once the dialogue has matured further.
The content of BioStock’s news and analyses is independent but the work of BioStock is to a certain degree financed by life science companies. The above article concerns a company from which BioStock has received financing.
