Government-backed Medical Research Commercialisation Fund makes first New Zealand investment in pharmaceutical company spun-out of the University of Auckland.
The Medical Research Commercialisation Fund (MRCF) today announces an investment of NZD$8 million in Series A funding for Kea Therapeutics Ltd., an early stage pharmaceutical company which is developing a new drug for the relief of severe pain.
Kea Therapeutics is a spin-out of the Auckland Cancer Society Research Centre (ACSRC) and Faculty of Medical and Health Sciences Waikato Clinical Campus, University of Auckland. It will use the investment from the MRCF, including co-investment and support from Auckland UniServices Limited’s University of Auckland Inventors Fund to advance the clinical development of a new pain drug based on the team’s medicinal chemistry, drug development and commercialisation expertise.
As a result of the MRCF investment, Kea Therapeutics will be able to commercialise their substitute for strong opioids in a range of clinical scenarios from pre-hospital to post-surgical pain relief and sedation. Kea Therapeutics will enter an already large and growing addressable market, driven by an aging population, chronic disease and increased hospital admissions.
It is anticipated that the first market for Kea Therapeutics drug will be moderate-to-severe acute pain in perioperative and emergency settings. There is significant potential for broader application for drugs. Phase I clinical studies are intended within 24 months of investment and hope to provide a useful early signal of reduced psychosis, and pain relief.
MRCF Investment Manager, Duncan Mackintosh, says non-opioid pain relief is urgently needed for the management of severe pain. “Opioids have a range of unwanted side effects, are highly-addictive and are causing a global epidemic of dependency on this type of pain medication. Kea’s approach offers the potential for a safer alternative to opioids for the management of pain that is not addictive and could be used in a wider range of clinical settings.”
Clinician, Professor Jamie Sleigh from Faculty of Medical and Health Sciences Waikato Clinical Campus, recognised the need for non-opioid pain relief alternatives. Working with medicinal chemist, distinguished Professor Bill Denny at the ACSRC, they initiated an integrated drug discovery programme to develop a new drug which retained the positive, pain relieving features of ketamine, while removing significant side effects that limit its broader clinical use. The early development of the drug was funded by the University of Auckland, Auckland UniServices Ltd and the Ministry of Business Innovation and Employment’s (MBIE) Pre-Seed Accelerator Fund. Further development of these compounds is planned to generate a new class of effective and well-tolerated pain relief agents.
“Kea Therapeutics wants to transform the pain relief industry with a much-needed, non-opioid approach and this funding will help us take our research into clinical testing and to the global pharmaceutical market,” says Evelyn Body, UniServices Director of Commercialisation for Biotechnology and Board Member of Kea Therapeutics.
“Despite New Zealand’s outstanding biomedical research rating, traditionally there has been a short supply of funding available for our life sciences sector,” Body says. “This collaboration marks a new chapter of increased venture capital investment in the country’s pharmaceutical and biotechnology industries and we are excited to be the MRCF’s first New Zealand investment and one of the largest in the sector.”
Kea Therapeutics will be led by world-class clinicians, drug discovery and development professionals and a highly-experienced management team and Board, including Dr Tom McCarthy as a non-Executive Director. Dr McCarthy is former President and CEO of Spinifex Pharmaceuticals, who led the MRCF-funded pain treatment company through to its sale to global pharmaceutical company Novartis for US$725 million in 2015.
In April 2016, with support from the MBIE, New Zealand joined the MRCF, enabling New Zealand research organisations to become members and seek investment support for emerging technologies.
“The New Zealand government showed great vision by supporting the establishment of MRCF in NZ, enabling our research institutes access to a large pool of capital investment dedicated to life science discoveries,” Mackintosh says. “As a result, promising early-stage medical research can be developed and commercialised locally, strengthening New Zealand’s biotech ecosystem and the wider economy by creating jobs and wealth.”
About Kea Therapeutics
Kea Therapeutics is a pharmaceutical company which has been spun out of the Auckland Cancer Society Research Centre, and Faculty of Medical and Health Sciences Waikato Clinical Campus, University of Auckland, developing a new range of non-opioid analgesics. Kea Therapeutics has received investment from the University of Auckland’s commercialisation unit, Auckland UniServices Limited, and the Medical Research Commericialisation Fund. Kea Therapeutics plans to commence Phase I studies of its analogues within two years.
About the Medical Research Commercialisation Fund (MRCF)
The MRCF is the largest life sciences fund in Australia and New Zealand, with AU$480 million under management. It is a unique collaboration between major Australian superannuation funds, the Australian and New Zealand governments, Australian state governments and over 50 leading medical research institutes and research hospitals. The MRCF supports the development and commercialisation of early-stage biomedical discoveries originating from member research organisations, providing both capital and expertise to guide the successful development of new therapies.
In May this year, Former Fisher & Paykel Healthcare Chief Executive, Mike Daniell, who led the team which transformed Fisher & Paykel’s small healthcare division into an international success earning over NZ$800 million in revenue, joined the MRCF Board.
Current New Zealand members of the MRCF are: Auckland Cancer Society Research Centre, University of Auckland; Institute for Innovation in Biotech, University of Auckland; Brain Health Research Centre, University of Otago; Malaghan Institute of Medical Research; Ferrier Research Institute, Victoria University of Wellington; Callaghan Innovation.