Buoyed by Positive Gene Therapy Results in DEB, Krystal Raises $100 Million

Krystal Biotech reported positive results from its phase 2 clinical trial of KB103, Krystal’s lead gene therapy candidate to treat dystrophic epidermolysis bullosa, an incurable skin blistering condition caused by a lack of collagen in the skin. 

In anticipation of conducting a pivotal phase 3 trial, the company launched a follow-on stock offering of 2.5 million shares at $40 a share to raise $100 million.

Dystrophic epidermolysis bullosa (DEB) is caused by mutations in the gene coding for type VII collagen, or COL7, a major component of anchoring fibrils, which connect the epidermis to the underlying dermis, and provide structural adhesion between these skin layers in a normal individual. The lack of COL7 in DEB patients causes blisters to occur in the dermis as a result of separation from the epidermis. This makes the skin incredibly fragile, leading to blistering or skin loss at the slightest friction or knock. It is a progressive and painful condition.

KB103 is a replication-defective, non-integrating viral vector that has been engineered to deliver functional human COL7A1 genes directly to the patients’ dividing and non-dividing skin cells. The proprietary vector, HSV-1, can penetrate skin cells efficiently and its high payload capacity allows it to accommodate large or multiple genes and its low immunogenicity making it a suitable choice for direct and repeated delivery to the skin.

The phase 2 trial included patients from the phase 1 study and four additional patients—two adults ages 22 and 19, and two children ages 14 and 15. Patients were randomized to receive either KB103 or placebo in a 2:1 ratio. A total of four KB103-treated recurring wounds and two KB103-treated chronic wounds were included in the trial results. Chronic wounds remain open for greater than 12 weeks while recurring wounds open and close spontaneously. Having established the presence of type VII collagen (COL7) and anchoring fibrils in the phase 1 portion of the trial and acknowledged by the FDA, the endpoints of the phase 2 study were revised toward a focus on clinical improvement.

The results showed that five out of six wounds treated with KB103 closed 100 percent with the average time to closure at 23 days. With the exception of one chronic wound, which has been open for four years, the remaining treated wounds remained closed 90 days after treatment. The duration of wound closure on two patients in the phase 1 trial as of the last follow-up was 184 days and 174 days. None of the placebo treated wounds closed at the 90 day time point.

Safety data from all patients in phase 2 trial at 90 day timepoint show that KB103 was well tolerated with no serious adverse events, and no drug-related adverse events reported. No inflammation or irritation was observed in KB103-treated wounds. In addition, no antibody response was noted for COL7.

Patients were biopsied on KB103 treated wounds on day 30 and functional COL7 was detected. To not interfere with wound healing, a second biopsy is anticipated to be done at end of trial, based on patient schedules.

“New treatments for patients suffering from EB are desperately needed, especially one that provides a convenient, painless way to administer treatment for patients suffering with this debilitating disease and to reduce their travel burden,” said Peter Marinkovich, associate professor of dermatology, Stanford University and principal investigator in the study. “These exciting data in the phase 1/2 trials are supportive of this very promising new approach for treating this debilitating disease.”

Krystal recently enrolled and increased frequency of dosing on two additional patients to study chronic wounds in more detail and in preparation of designing a robust pivotal trial that it expects to begin before the end of 2019.

The funding from the follow-on offering will be used to advance KB103 into pivotal studies, to advance development of its therapeutic pipeline, to complete development of a manufacturing facility for its compounds, and for working capital and general purposes.

KB103 has regenerative medicine advanced therapy (RMAT) designation in the United States and PRIME designation in Europe. Established under the 21st Century Cures Act, RMAT designation is designed to expedite the development and approval of regenerative medicine products, including gene therapy products.  An investigational therapy is eligible for the RMAT designation if it is intended to treat, modify, reverse or cure a serious or life-threatening disease or condition, and preliminary clinical evidence indicates a potential to address unmet medical needs for that disease or condition.

The designation includes all the benefits of the FDA’s Fast Track and Breakthrough Therapy designations and enables the ability to work more closely and frequently with the FDA to discuss surrogate or intermediate endpoints to support the potential acceleration of approval and satisfy post-approval requirements.

Photo: Peter Marinkovich, associate professor of dermatology, Stanford University and principal investigator in the study