Hypnion Inc.
This article was originally published in Start Up
Executive Summary
Hypnion Inc. aims to develop the next generation of drugs for the multi-billion dollar sleep market. It is taking marketed CNS drugs that have known sleep/wake side effects, then optimizing those effects to create safe, non-addictive patentable analogs.
Nothing beats a good night's sleep
Five-Biotech
381 Plantation Street
Worcester, MA 01605
Phone: (508) 438-2800
Fax: (508) 438-2810
Web Site: www.hypnion.com
Contact: John F. Dee, President & CEO
Industry Segment: Pharmaceuticals
Business: Therapeutics for sleep/wake disorders
Founded: March 2000
Founders: Dale M. Edgar, PhD, SVP, Preclinical R&D & CSO; Emmanuel Mignot, MD, PhD; Karen Moore, PhD; Michael Rosbash, PhD; Joseph S. Takahashi, PhD
Employees: 27
Financing to Date: $58 million
Scientific Advisory Board: Emmanuel Mignot, MD, PhD (Stanford University); Michael Rosbash, PhD (Brandeis University); Thomas Roth, PhD (Henry Ford Sleep Disorders Center); Joseph S. Takahashi, PhD (Northwestern University)
Plenty of drugs will put you to sleep, but there's always a price to pay. With some, it's the hangover the next morning. With others, it's waking up wide-eyed in the middle of the night. And with all prescription sleep medications, there's the danger of dependence.
Hypnion Inc. believes that there is clear room for improvement. It aims to develop worry-free drugs for the multi-billion dollar sleep market, taking marketed CNS drugs that have known sleep/wake side effects, then optimizing those side effects to create patentable analogs that work on pathways with no potential for abuse or addiction. The three-year-old company plans to develop new chemical entities not just for insomnia, but for other sleep and circadian rhythm disorders, and one day expand into other CNS indications. The model has obvious investor appeal: Hypnion recently closed a $47.5 million Series B round led by Forward Ventures and MPM Capital. [See Deal]
The firm's founding scientists have made some of the pioneering discoveries in sleep genomics: Emmanuel Mignot, the canine narcolepsy gene; Joseph Takahashi, the clock mutation in mice; and Michael Rosbash, the first circadian gene in Drosophila. Co-founder and CSO Dale Edgar contributed the company's technology platform--the Score 2000 high-throughput in vivo assay system, which he developed at Stanford University and which Hypnion has exclusively licensed. "It is the world's most advanced sleep-wake bioassay system," says Hypnion president and CEO John Dee, former president and CEO of Procept Inc., who joined Hypnion shortly after its March 2000 founding.
Edgar's Score 2000 was developed over the course of 15 years at Stanford's Sleep Research Center. It provides simultaneous, real-time evaluation of a number of physiological and behavioral variables in rat models. Data is analyzed against the "world's largest" pharmacology database of more than 300 compounds in 15 classes of drugs, says Dee. These are not just sleep drugs, he notes, but anything that impacts sleep/wake as a side effect. Results are also compared to published clinical data on existing drugs. The upshot is unparalleled predictive ability—greater than 90% concordance between human and animal response, according to Dee.
Beyond its predictive capabilities, Score 2000 is also a powerful tool for lead optimization, providing immediate feedback on efficacy, oral bioavailability and side effects. The wealth of concurrent real-time data enables medicinal chemists to rapidly enhance a compound's sleep effect and minimize its other effects on the target of interest.
Formed at the peak of the genomics revolution, Hypnion's original plan was to use Score 2000 for both drug discovery and target discovery, with founder Karen Moore, PhD, the former director of genetic systems at Millennium Pharmaceuticals Inc. heading up the target discovery effort. Adapting to market realities and the difficulties encountered by platform biotechs in getting validation through dealmaking, Hypnion abandoned target discovery in the fall of 2002 to focus exclusively on its drug discovery program.
Targeting a number of primary pathways identified at the company that don't carry a risk of addiction or dependence, Hypnion set about building analogs of CNS drugs with sleep/wake effects and screening them through Score 2000. Hypnion tested some 200 compounds for its lead programs, Dee says, and has narrowed the pool to a lead candidate and two back-ups for insomnia, and one candidate for wakefulness disorders like excessive daytime sleepiness (EDS) associated with narcolepsy or chronic fatigue syndrome. All of the candidates are highly selective to the target of interest, their safety born out in Score 2000, he reports. They also appear very effective, especially for sleep maintenance, which is a problem for two-thirds of insomniacs. "Our studies indicate that our insomnia candidates are significantly better than the leading marketed drug," says Dee, referring to Sanofi-Synthelabo's $1 billion zolpidem (Ambien). Similarly, he believes that Hypnion's non-dopamine wakefulness candidate is more than a match for Cephalon Inc. 's $200 million modafinil (Provigil) for EDS. Unlike these two medications and other marketed sleep/wake therapeutics, Hypnion is optimistic that the FDA will not schedule its compounds as controlled substances.
Hypnion's lead for insomnia just entered preclinical development. Dee will not provide specifics on the compound, other than to say it does not work on GABA or the benzodiazepine receptor. The company hopes to initiate Phase I trials in the second quarter of 2004. The other two insomnia candidates should move into preclinical studies in 2004, with Phase I trials a year later.
Its recent infusion of $48 million gives Hypnion the financial wherewithal to take its lead through all of the Phase II trials it will require. Those trials should start in the second quarter of 2005. Dee envisions a larger trial followed perhaps by a series of key differentiation trials, to determine the best clinical settings for which to seek approval. The trials may be expedited because Hypnion's NCEs are analogs of marketed drugs, but whatever the case, Hypnion is intent on laying the proper groundwork to attract a strategic partner to take the compound through regulatory approval and to market.
"Neurocrine set a wonderful bar," says Dee, referring to Neurocrine Biosciences Inc. 's $400 million-plus development and marketing alliance with Pfizer Inc. for its insomnia compound indiplon [See Deal]. (See "The Infrastructure Dilemma," IN VIVO, January 2003 (Also see "The Infrastructure Dilemma" - In Vivo, 1 Jan, 2003.).) He is looking for as substantial a partnership for Hypnion's lead and subsequent compounds in its pipeline.
Hypnion eventually wants to expand into drug discovery for other CNS indications that are related to sleep disorders, including pain, depression, anxiety, epilepsy and Alzheimer's disease. It is unproven at this point how Score 2000 will perform in the broader CNS arena, where the predictive power of in vivo assays is problematic. Hypnion's very early work in rat models of depression and Alzheimer's shows promise, Dee says. In parallel to clinical development of its leads for insomnia and wakefulness, Hypnion's goal is to select one CNS program to test out Score 2000, so that in three years' time--when Dee anticipates another funding round--Hypnion will be ready to make its move.
With partnerships a few years away, and commercialization more distant, Hypnion may derive limited near-term revenues from screening select pharmaceutical clients' compounds on Score 2000. The company may also dip its toes back into target discovery: Dee also believes that Score 2000 system is well suited for testing transgenic and knockout mice for novel target validation.
But for the next three years, the company's primary focus is on what it views as a potential $10 billion sleep market. There is tremendous unmet need--current sleep products are generating just $2 billion in annual sales, despite the fact that 80 million Americans suffer from sleep disorders. The challenge and opportunity for Hypnion: to develop drugs that people aren't afraid to take—NTD