Neurological disorder therapy developer Axovant Sciences has spun off small molecule drug developer Arvelle Therapeutics with more than $100m in funding, and is retaining a 5% stake in the Switzerland-based startup.
The round included investment firms Andera Partners and NovaQuest Capital Management as well as private equity firm LSP, growth equity firm BRV Capital Management and asset manager HIG BioHealth Partners.
Arvelle is developing a medicine called cenobamate to treat partial-onset epileptic seizures, after receiving the European licence rights for it from South Korea-based drug developer SK Biopharmaceuticals.
SK received an upfront payment of $100m through the deal and could secure up to $430m if certain regulatory and commercial milestones are met, in addition to royalties on net sales generated in Europe. It will also have the option to buy an equity stake in Arvelle.
US-headquartered Axovant will focus solely on gene therapies following the spinout. Mark Altmeyer, chief commercial officer at Axovant, is taking the president and chief executive positions at Arvelle.
Pavan Cheruvu, Axovant’s CEO, said: “The transition of Axovant’s small molecule team to Arvelle completes our transformation into a company focused exclusively on the development of innovative gene therapies, while offering us an opportunity to reduce costs and realise long-term value from our legacy small molecule platform.”