Alumis readies IPO to fund rival drug to Bristol Myers’ Sotyktu

Dive Brief:

• Biotechnology startup Alumis on Friday outlined plans for an initial public offering that would fund clinical development of a pair of autoimmune and neurological disease drugs.
• Both medicines are TYK2 inhibitors, a group of oral medicines that drugmakers are positioning as alternatives to injectable biologics for inflammatory conditions. One should begin late-stage testing in psoriatic arthritis later this year and is in Phase 2 trials for other autoimmune conditions. Alumis also has a similar central nervous system-targeting drug in a Phase 1 trial, according to its IPO filing.
• After a fast start this year, the pace of biotech IPOs has slowed, with 11 companies raising about $1.6 billion in combined proceeds. While fewer companies had priced an IPO by the same point last year, more did in each of the five years prior, according to BioPharma Dive data. Only one biotech, Rapport Therapeutics, has gone public in the last two months.

Dive Insight:

Alumis’ IPO is the latest test of investor interest in immunology, an area of drug research that’s been in focus for pharmaceutical companies and biotech venture firms this year.

There have been 10 buyouts of immune drug developers in 2024, more than in each of the previous six years, according to BioPharma Dive data. Seven of those buyouts involved private biotechs, led by Johnson & Johnson’s $1.25 billion buyout of Yellow Jersey Therapeutics last month.

Several immunology-focused startups, among them Mirador Therapeutics, AltruBio and Capstan Therapeutics, have raised funding rounds exceeding $100 million, meanwhile. Alumis closed a $259 million series C round three months ago.

Immune drug developers account for only two of the 11 new biotech stock issuances this year. But they are also responsible for three of the five largest IPOs — Acelyrin, Kyverna Therapeutics and Apogee Therapeutics — since the start of 2023.

Alumis’ offering will help support Phase 3 trials of a drug it claims could be a challenger to Bristol Myers Squibb’s TYK2 inhibitor Sotyktu. Sotyktu was approved in 2022 for plaque psoriasis and is being evaluated in multiple other inflammatory conditions. Alumis claims its lead drug, ESK-001, is more selective and potent.

But that hasn’t been proven yet, and ESK-001 trails a competing TYK2 medicine from Takeda. Ventyx Biosciences, another TYK2 drug developer with a similar IPO pitch to Alumis, lost most of its market value and redrew its development plans after disappointing study results in 2023.

With ESK-001, Alumis is starting with psoriatic arthritis, a disease Sotyktu isn’t yet approved to treat. The company intends to start Phase 3 studies in that indication later this year, and has Phase 2 trials underway in lupus and uveitis underway.

Because certain genetic mutations to TYK2 have been associated with a protective effect in multiple sclerosis, the company is developing a different TYK2 inhibitor, A-005, for neuroinflammatory conditions, according to Alumis’ filing. Phase 1 results are expected by the end of 2024.

Alumis acquired ESK-001 via a buyout of startup FronThera in 2021. Some of the IPO proceeds would be used to make a $23 million payment to FronThera’s shareholders at the start of a Phase 3 trial. Alumis would still owe FronThera’s backers another $60 million in potential milestone payments afterwards, according to the IPO filing.

Alumis, previously known as Esker Therapeutics, was incubated by San Francisco startup incubator Foresite Labs and formed in 2021.