Long Island drug startup snares $8.3 million in venture funding

A Long Island drug startup has snared $8.3 million in venture capital to develop potential treatments for Rett Syndrome, Wilson's disease and breast cancer.

The financing round for DepYmed Inc., based at the Broad Hollow Bioscience Park in Farmingdale, was led by Roslyn Heights-based Topspin Fund LP.

DepYmed president and chief executive Andreas G. Grill said the proceeds would be used to expand the company's management team and to complete new drug applications that would advance research from the preclinical stage to phase 1 human trials.

Phase 1 trials could begin in 12 to 15 months.

"Funding will accelerate all of the efforts we're doing right now," said Grill, the company's sole full-time employee.

The company is working to develop drugs based on the discoveries of Nick Tonks, a researcher at Cold Spring Harbor Laboratory, said Leo A. Guthart, Topspin's managing partner.

Tonks is a globally recognized expert in inhibitors of phosphatase enzymes, which regulate genetic pathways and other basic cellular functions.

When applied to disease, those inhibitors can revise the cellular circuitry seen in a wide variety of disorders, said Tonks, scientific founder and adviser to DepYmed.

"This is a very important pathway that has been largely overlooked," Guthart said.

Among the initial targets DepYmed is exploring are:

— Rett Syndrome, a genetic neurological disorder, characterized by repetitive movements, that stunts the ability of babies and toddlers to speak, walk and eat;

— Wilson's disease, an inherited condition that causes copper to accumulate in the liver and brain, resulting in symptoms that include fatigue, pain, fluid buildup and problems with coordination;

— Certain breast cancers.

Tonks said that initial research indicates the company's therapeutic compound creates a two-pronged attack against cancer by striking the tumor itself, while also mounting an immune response by helping the body to recognize the cancer.

The company also been investigating use of the inhibitors to moderate "cytokine storms" in COVID-19 patients, Tonks said.

Those uncontrolled immune responses can result in organ failure and death if untreated.

DepYmed, founded in 2014, got a $2 million funding round in 2016 that was led by Topspin.

In 2015, the company received $100,000 from Accelerate Long Island, a nonprofit economic development group, and the Long Island Emerging Technologies Fund.

Grill said DepYmed plans to pursue drug candidates independently, but "there's always the potential to partner with a large or mid-size pharmaceutical company … I'd never say never."

Tonks, deputy director of the Cancer Center at Cold Spring Harbor Laboratory, noted the regional collaboration between the scientific institution, venture capital firm and the company.

"This is a great Long Island story," he said.

By Ken Schachter

kenneth.schachter@newsday.comkschach

Ken Schachter covers corporate news, including technology and aerospace, and other business topics for Newsday. He has also worked at The Miami Herald and The Jerusalem Post.