"Billion-Dollar Molecules" Continue to Emerge! Could This Target Be the New Focus for Autoimmunity?

On October 15, American biotechnology company Upstream Bio announced the completion of a $293 million initial public offering (IPO), significantly exceeding its previously estimated fundraising amount. The company’s stock began trading on the Nasdaq Global Select Market on October 11, 2024, under the ticker symbol “UPB.” As of the close on October 16, the stock price had increased by 39%, resulting in a total market capitalization of $1.213 billion. This market value is supported by only one introduced, clinical-stage candidate drug, which Upstream Bio describes as “the only known clinical development-stage antagonist of the thymic stromal lymphopoietin (TSLP) receptor.”

In the past two years, there has been continuous market news regarding the TSLP target, with one of the most notable events occurring in August 2023 when Hangzhou Hikvision's TSLP monoclonal antibody SHR-1905 was exclusively licensed to One Bio (later renamed Aiolos Bio) outside the Greater China region. According to the agreement terms, Hangzhou Hikvision will receive a total of $25 million as an upfront payment and milestone payments, which could total up to $1.025 billion for research and sales milestones. With this asset, Aiolos Bio announced the completion of a massive $245 million Series A financing just two months later, boasting a lineup of prestigious investors including Atlas Venture, Bain Capital, and RA Capital. Following this, in January 2024, GlaxoSmithKline announced it would acquire Aiolos Bio for a $1 billion upfront payment and up to $400 million in milestone payments. This series of transactions has allowed Hangzhou Hikvision to achieve “curve sailing,” with voices in the industry suggesting that Hangzhou was “profiting from the price difference” and “making a wedding dress for others.” (Acquired by GSK for a $1 billion upfront payment in under a year, Hangzhou Hikvision's TSLP asset earned a significant profit.)

"Upstream" Targeting Immune Signals

Thymic stromal lymphopoietin (TSLP) is a cytokine that has been clinically validated as a driver of inflammatory responses and is located upstream in various signaling cascades that influence immune-mediated diseases. This may also be the inspiration for Upstream Bio's name.

TSLP is primarily produced by epithelial cells, especially in the lungs, gastrointestinal tract, and skin. Dendritic cells, basophils, mast cells, keratinocytes, and fibroblasts can also produce TSLP under appropriate stimulation. In response to various environmental triggers (including viruses, bacteria, allergens, chemical irritants, and physical damage), TSLP can initiate and amplify a wide range of innate and adaptive immune responses, including supporting epithelial barrier function, activating dendritic cells, activating and sustaining type 2 innate lymphoid cells, recruiting immune cells, inducing type 2 responses, and regulating B cell functions. In addition to type 2 inflammation, data also suggest that TSLP plays a role in mediating non-type 2 inflammatory processes, including IL-17 production, modulation of airway structural cells, and promotion of fibrosis. Therefore, TSLP signaling is a central initiator of multiple downstream biological pathways associated with human diseases characterized by epithelial inflammation, such as asthma, chronic rhinosinusitis with nasal polyps (CRSwNP), and chronic obstructive pulmonary disease (COPD).

Currently, there is only one drug targeting the TSLP pathway on the market, which is Tezspire? (tezepelumab) developed by AstraZeneca/Amgen. This drug was approved by the FDA in December 2021 as an add-on maintenance therapy for severe asthma patients aged 12 and older. Tezepelumab is known to be the first and currently the only treatment for severe asthma that does not have any phenotypic or biomarker restrictions. Compared to other biologics that act further downstream, it shows benefits in blocking TSLP signaling early in the inflammatory cascade. This year, Amgen also announced that Tezepelumab received FDA designation as a breakthrough therapy for use as an add-on maintenance treatment in patients with moderate to severe COPD. This further demonstrates the potential of TSLP-targeted therapies in treating various inflammatory diseases. In 2023, Tezepelumab achieved sales of $567 million.

However, since TSLP was first discovered in 1994, only one drug has successfully been launched in the past 30 years, which indirectly highlights the challenges in developing TSLP-targeted therapies. Several large pharmaceutical companies, including Merck, Roche, and AstraZeneca, have previously struggled with TSLP-targeted drug development, but in recent years, the role of this target in immune inflammatory diseases has garnered increasing attention.

The Only Pipeline Asset Comes from Amgen, Backed by Prestigious Investment Firms

Upstream Bio, which recently went public on Nasdaq, has only one asset in its pipeline, sourced from Amgen, which had previously developed TSLP-targeted drugs.

Verekitug (UPB-101), formerly known as ASP7266, was initially developed by Amgen and completed preclinical studies as well as a Phase 1 single-dose escalation study. However, after a strategic evaluation, Amgen discontinued the project. In November 2020, Amgen publicly sought to sell eight research and development projects on its website, with ASP7266 being one of them. In October 2021, Upstream acquired ASP7266 (Verekitug), just months after the company was founded.

At the time of Upstream Bio's establishment in 2021, its main investors were OrbiMed and Maruho. OrbiMed is a well-known global investment firm in the healthcare sector, having invested in numerous notable pharmaceutical companies such as Zai Lab, CanSino Biologics, Rongchang Biopharmaceutical, and Baidu Tianheng.

In January 2022, Upstream Bio announced a $200 million Series A financing, marking its first public appearance. The Series A round was co-led by OrbiMed and Maruho Co., Ltd., with participation from Access Biotechnology, Decheng Capital, HBM Healthcare Investments, TCG X, Omega Funds, Samsara BioCapital, and Altshuler Shaham Provident Funds Ltd. After completing the Series A financing, Upstream Bio began advancing the Verekitug (UPB-101) project and building a pipeline of assets for addressing immune-mediated diseases.

In June 2023, Upstream Bio announced the completion of a $200 million Series B financing, which was co-led by Enavate Sciences and Venrock Healthcare Capital Partners. New investors Bain Capital Life Sciences and Wellington Management, along with Series A investors OrbiMed, Access Biotechnology, Decheng Capital, Altshuler Shaham Provident Funds Ltd., TCG X, HBM Healthcare Investments, Omega Funds, and Samsara BioCapital participated in the round. The funds raised will be used to further advance the clinical development of Verekitug (UPB-101).

As of June 30, 2024, Upstream Bio held $235.8 million in cash, cash equivalents, and short-term investments. With the funds raised from this IPO, the company's cash flow is expected to extend into mid-2027.

Exploring Opportunities for Multiple Diseases

Verekitug (UPB-101) is a novel recombinant fully human immunoglobulin G1 (IgG1) monoclonal antibody (mAb) that binds to the TSLP receptor (TSLPR) to inhibit signaling, whereas TezspireTM (tezepelumab), already on the market from AstraZeneca/Amgen, targets the TSLP ligand. According to Upstream Bio’s press release, blocking the TSLP receptor presents an opportunity for monotherapy that can impact various pathological inflammatory processes across different diseases. The company is currently conducting Phase 2 clinical trials for this drug in the treatment of severe asthma and CRSwNP (chronic rhinosinusitis with nasal polyps), and plans to initiate clinical trials for COPD (chronic obstructive pulmonary disease).

Phase 1b multiple-dose escalation trials have shown that Verekitug can quickly and fully bind to the TSLP receptor, resulting in a rapid and significant reduction in fractional exhaled nitric oxide (FeNO) levels and blood eosinophil levels, with effects lasting up to 24 weeks after the last dose. Based on published data, this study also indicates that Verekitug is approximately 300 times more potent than Tezepelumab. Additionally, pharmacokinetic characteristics suggest that Verekitug can extend the dosing interval to 24 weeks compared to Tezepelumab, which has a 4-week dosing interval. The Phase 1b study demonstrated that Verekitug’s impact on FeNO is about 50% greater than that of Tezepelumab as previously reported. To date, Verekitug has completed three Phase 1 clinical trials involving a total of 120 participants, including 32 asthma patients.

Upstream Bio indicates that if Verekitug is approved, its extended dosing interval and its effects on widely accepted disease-related biomarkers could make it a preferred biologic for treating severe asthma, CRSwNP, and COPD.

The Phase 2 clinical trials for Verekitug in CRSwNP and severe asthma started in January 2024 and March 2024, respectively, and patient recruitment is currently ongoing. Data from these two independent Phase 2 studies are expected to be released in the second half of 2025 and the second half of 2026, respectively.

Asthma is a common respiratory disease, affecting more than 25 million people in the United States, with an estimated 5%-10% suffering from severe asthma (defined as asthma that remains uncontrolled despite optimized treatment with high-dose inhaled corticosteroids, or requires high-dose inhaled corticosteroids to prevent loss of control). It is estimated that about 90% of severe asthma patients are eligible for biologic therapy, but currently, only 440,000 patients have received biologic treatment, indicating that over 80% of eligible patients have not received optimal treatment. In 2023, sales of biologics for severe asthma treatment in the U.S. are projected to reach approximately $6 billion.

CRSwNP (chronic rhinosinusitis with nasal polyps) is an inflammatory disease of the upper airways characterized by chronic sinus inflammation and the presence of inflammatory polyps in the nasal cavity and sinuses. According to Sanofi estimates, there are approximately 900,000 CRSwNP patients in the U.S. and Europe. It is estimated that 40%-45% of severe asthma patients also have CRSwNP, and up to 65% of CRSwNP patients have asthma, indicating a strong correlation between the two diseases. Approximately 200,000 adult CRSwNP patients in major markets in the U.S., Europe, and Japan are estimated to be eligible for biologic treatment. Current treatment options for CRSwNP patients include corticosteroids, surgery, and biologics, but many CRSwNP patients still have uncontrolled symptoms, indicating a continued unmet treatment need.

Based on Phase 1 trial data for Verekitug, Upstream Bio also plans to initiate the first clinical trial of Verekitug for the treatment of COPD (chronic obstructive pulmonary disease) and has begun planning activities for Phase 2 clinical trials, including developing clinical trial protocols and regulatory approval strategies, with the first COPD patient expected to receive treatment in the second half of 2025.

Similar to asthma, COPD is a chronic inflammatory disease that obstructs airflow in the lungs, usually caused by long-term exposure to irritants (most commonly cigarette smoke). Individuals with a history of asthma are also more prone to developing COPD. COPD is the third leading cause of death globally, causing approximately 3.2 million deaths in 2019. Nearly 14.2 million Americans (6.5% of the adult population) report being diagnosed with COPD, but the actual number may be higher, as more than half of adults with reduced lung function are unaware they have COPD. Dupilumab from Sanofi/Regeneron is currently the only biologic approved for the treatment of COPD. Despite available treatments, the existing medications are insufficient to control symptoms or disease progression, given the high prevalence and mortality rates associated with COPD.

In addition to these indications, Upstream Bio believes that Verekitug has broad potential and intends to leverage its unique properties to develop it as a potential therapy for various TSLP-driven diseases.

The field of immune inflammatory diseases encompasses a large patient population with unmet treatment needs, and TSLP, as an important target in inflammation and autoimmune diseases, is attracting more and more participants. According to statistics from PharmaCircle, companies globally developing drugs targeting TSLP include Amgen, AstraZeneca, Novartis, and domestic companies such as Maizai Biopharma, ZhiXiang JinTai, BoaoXin/Zhengda Tianqing, Conora/Shiyou Group, HengRui Medicine, and Habo Medicine/Kelun Botai, Qianxin Biopharmaceuticals/Jiankangyuan, LuoQi Biotechnology, and TuoChuang Biotech, among others.

Reference

https://upstreambio.com/；

https://investors.upstreambio.com/news-releases/news-release-details/upstream-bio-announces-closing-293-million-upsized-initial；

https://www.fiercebiotech.com/biotech/inflammation-focused-upstream-set-join-growing-trickle-biotech-ipos；

https://www.businesswire.com/news/home/20231024577944/en/Aiolos-Bio-Launches-with-245-Million-Series-A-Investment-to-Advance-Development-of-Novel-Phase-2-Ready-TSLP-Antibody/；

https://www.gsk.com/en-gb/media/press-releases/gsk-enters-agreement-to-acquire-aiolos-bio/；