Going nuclear: radiopharmaceuticals see surge in funding

Photo/Anastasiia Slynko
Radiopharmaceuticals drugs

Emerging as a new class of drugs, radiopharmaceuticals are all the rage in cancer treatment research, at present. And now, with American biotech Nucleus RadioPharma raising $56 million to streamline its supply chains and make the drugs more accessible, it seems like the radiopharmaceutical market might be onto something big.

The series A funding round, which was led by GE HealthCare and venture capital Eclipse, will contribute to setting up manufacturing facilities across the U.S., and in the development and commercialization of its radiopharmaceuticals.

“Theranostic radiopharmaceuticals are offering promise for millions who currently have limited treatment options,” said Charles S. Conroy, chief executive officer (CEO) of Nucleus RadioPharma. “As truly targeted therapies, these drugs are proving not only to be highly effective but also to maintain a superior safety profile. This funding advances the reach and impact of these life-saving agents, allowing for therapies that can be mass-produced, and offers hope to those with few alternatives.” 

Nucleus RadioPharma’s fundraising is becoming part of a larger market trend witnessed by the radiopharmaceutical industry. But first, how do these drugs target cancer?

The science behind radiopharmaceutical drugs

When an imaging radioactive isotope of an element – like fluorine-18, gallium-68, zirconium-89 and technetium-99m – is bound to a drug or monoclonal antibody and delivered intravenously to a patient with cancer, it attaches itself to cancer cells, much like a key to a lock. Then, with the help of nuclear imaging, the radioisotope can be spotted, therefore locating the tumor cells.

Once the target cells have been identified, a therapeutic radioisotope – namely, actinium-225, iodine-131, yttrium-90 and astatine-211, among others – that is linked to the same kind of vector that was previously used in detecting the target, enters the cancer cells. The radioactive compound then breaks down, releasing energy that damages cancer cells, as these cells are particularly sensitive to DNA damage that is caused by radiation. This is the mechanism behind radiopharmaceutical drugs.

With a market value of $4.5 billion in 2022, which is forecasted to more than double over the next decade, according to a report by Market.Us, the radiopharmaceutical industry is growing, as more companies are becoming invested in the field

Radiopharmaceutical market thrives with funding surge and notable mergers

Just last month, American pharmaceutical Eli Lilly announced that it would snap up Point Biopharma for $1.4 billion, marking one of the most significant mergers and acquisitions (M&A) deals of all time, in the radiopharmaceutical market. This means that the multinational company would acquire all of Point Biopharma’s drug candidates including its pan-cancer program targeting fibroblast activation protein-α (FAP-α), and its drug candidate for people with metastatic castration-resistant prostate cancer (mCRPC), where the lead isotope is lutetium-177. 

Besides, Eli Lilly seems to be quite keen on fostering radiopharma companies lately. The biotech giant helped fund an oversubscribed $175 million for Massachusetts-based Mariana Oncology, whose radio-conjugation platform aims to expand theranostic options to patients. The funds will help move its lead asset MC-339 to the clinic next year, to potentially treat small cell lung cancer. 

Moreover, this year has been a turning point for various other biotechs focused on delivering radiopharmaceutical drugs to patients with cancer. Canadian startup Abdera Therapeutics emerged out of stealth with a $142 million combined series A and B funding, with which it will advance its pipeline of antibody-based precision radiotherapeutics. Its lead candidate designed to treat small cell lung cancer (SCLC) is slated to go to the clinic once it gets the go-ahead from the U.S. Food and Drug Administration (FDA) next year. The startup has four other candidates – with undisclosed targets – in the lead optimization stage.

Another company that swayed investors this year was California-based RayzeBio. The company reeled in $160 million in a series D round co-led by Viking Global Investors, Sofinnova Investments and Wellington Management. This amounts to a total of $418 million raised since its inception. 

Poised to be the first actinium-225 (Ac225) approved drug, the startup’s lead candidate RYZ101 is currently in phase 1B clinical trials for patients with neuroendocrine tumors. RYZ101 is a targeted therapy that is designed to deliver Ac225 to tumors that express the somatostatin receptor type 2 (SSTR2) – both a biomarker and a therapeutic target that many radiopharmaceuticals are focused on drugging. 

Now, the company has signaled that it might go public, as it plans an initial public offering (IPO) to push RYZ101 into phase 3 studies, possibly this year.

Meanwhile, as more funding deals like American company Convergent Therapeutics closing its series A round with $90 million, and with Radionetics Oncology in the middle of a fundraising drive, having nabbed $54.2 million so far, according to the U.S. Securities and Exchange Commission (SEC) filings, radiopharmaceuticals seem to be a hot topic for investors at the moment.

Looking beyond challenges

As the theranostics landscape evolves, radiopharmaceuticals – unlike chemotherapy and immunotherapy where months of treatment is required before the benefits of the drugs kick in – can show therapeutic responses after a few injections, according to Jamal Temsamani, drug development director at Vect-Horus, who told Labiotech.

Moreover, because these drugs are better equipped at targeting cancer cells compared to radiation therapy – thereby regarded as a powerful tool in precision medicine – they seem to have fewer side effects on patients. On the other hand, radiation therapy has been linked to side effects like nausea, hair loss, mouth sores, difficulty swallowing, and various others that come with the part of the body where the therapy is aimed at.

However, developing radio-labeled drugs is no picnic. Steffen Schuster, CEO of ITM Group in Germany explained in a Labiotech article in 2022, that many companies do not understand the supply chain for radiopharmaceuticals, and underestimate how short the half-life of the drug is – due to the presence of a radioisotope. And so, factoring in elements like transport, where it must reach different parts of the world before it decays, is essential. Schuster also pointed out that hospitals need to amp up their nuclear medicine departments in order to partake in clinical trials. 

To add to that, picking the most suitable radioisotope is key to an effective treatment. While beta particles – which have less charge and mass – can penetrate tissues and have a less damaging outcome, some companies are looking into the power of alpha radiation, which can deliver a lot of energy to nearby cells, making it quite destructive despite traveling a much shorter distance. So, depending on how aggressive the tumor is, providing the right treatment is important.

Keeping the many challenges in mind, radiopharmaceutical companies are now building portfolios that have made funding them hard to resist for investors. Thanks to Nucleus RadioPharma’s fundraising as well as various other investments in the market this year, we may see more radiopharmaceutical drug candidates hit the clinic soon.

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