US-based Karuna Pharmaceuticals, a startup developing drugs for psychiatric and cognitive disorders, has closed a $42m series A round that included pharmaceutical company PureTech Health.
The round included $22m of debt financing that was converted into equity, and PureTech was joined by Arch Venture Partners, Wellcome Trust and Steven Paul, a venture partner at venture capital fund Third Rock Ventures, as well as unnamed other backers.
Founded by PureTech, Karuna is working on therapeutics that will treat central nervous system disorders that cause cognitive impairment or psychosis, such as schizophrenia or Alzheimer’s disease, in addition to addressing neuropathic pain.
The funding will support a phase 2 clinical trial for Karuna’s lead drug candidate, KarXT, in schizophrenia, which is expected to commence in Q3 2018. KarXT is also being considered as a treatment for Alzheimer’s.
Andrew Miller, Karuna’s co-founder and CEO, said: “We greatly appreciate the support of our investors and their confidence in the potential of KarXT to be the first new and highly differentiated medicine in over 50 years for the treatment of psychosis and cognitive impairment in psychiatric and neurological disorders.
“We believe KarXT could be a promising new treatment that safely and effectively addresses the debilitating positive, negative and cognitive symptoms of patients living with schizophrenia and other central nervous system disorders.”
Wellcome had previously awarded $3.8m in grant funding to Karuna, and it added $8m in June this year to fund clinical development of KarXT. The company also received $600,000 in debt financing in 2011 according to a regulatory filing.