Orphazyme Raises $84 Million in U.S. Public Offering and European Private Placement

Orphazyme raised $84 million in new funding to advance its pipeline of heat shock protein therapeutics for the treatment of rare neurodegenerative diseases.

The Danish biotech made its public debut in the United States through an offering of 3.97 million American Depositary Shares at $11 a share. Orphazyme also sold an additional 3.65 million shares in a private placement in Europe. Orphazyme currently trades on the Nasdaq Copenhagen exchange under the symbol “ORPHA” and will continue to do so.

The American Depositary Shares will trade on the Nasdaq Global Select Market under the symbol “ORPH.” In addition, Orphazyme has granted underwriters the option to purchase up to an additional 1.1 million shares at the offering price.

The offering was completed below Orphazyme’s proposed $13.30 share price, which is uncommon these days as most biotech issues are upsized and pricing at the top of their proposed ranges. In an SEC filing ahead of the offering, Orphazyme said it had received communication from the U.S. Food and Drug Administration regarding its recently accepted marketing application for the experimental drug arimoclomol for the treatment of Niemann-Pick Disease type C (NPC), a rare and deadly lysosomal storage disorder.

While Orphazyme emphasized the FDA notice does not impact its recent acceptance of the new drug application, the target PDUFA action date or the FDA’s Priority Review determination, the communication identifies potential review issues that may need to be addressed notice ahead of an approval.

The FDA summarized six potential review issues, four of which Orphazyme said it previously discussed with the FDA, including the agency’s continuing evaluation of the integrity of data from its phase 2/3 trial for NPC; its method to determine the safety and efficacy of arimoclomol, which could have potential implications for labeling/recommended dosing and post-marketing studies; the proposed primary hypothetical treatment effect used in the trial to estimate the treatment benefit effect; the meaningfulness of one metric utilized to evaluate patient progress; the timing of submission of the QTc and other study reports to the FDA, including in light of evidence suggesting a potential QT safety signal; and differences among the formulations of arimoclomol used in the phase 2/3 trial of NPC as compared to the formulation of arimoclomol to be marketed.

The FDA requested submission of reports from the QTc clinical trial by October 1, 2020 in order to maintain the priority review timeline, something Orphazyme said it would not be able to do. The company noted that in a preclinical study, it observed a potential QT signal in dogs at a level of arimoclomol exposure that is 28 times higher than the level of exposure in humans in its phase 2/3 trial in NPC, and to date, is not aware of any clinical evidence of a potential QT signal related to arimoclomol.

Arimoclomol amplifies the production of heat-shock proteins (HSPs). HSPs can rescue defective misfolded proteins, clear protein aggregates, and improve the function of lysosomes. Arimoclomol is administered orally, crosses the blood brain barrier, and has been studied in seven phase 1 and three phase 2 trials. The FDA has also granted arimoclomol Fast Track, Breakthrough Therapy, Orphan Drug, and Rare Pediatric Disease designations for NPC.

Arimoclomol is also being studied in registrational clinical trials for the treatment of amyotrophic lateral sclerosis (ALS), and sporadic inclusion body myositis (sIBM), and is being advanced into pivotal-stage clinical development in neurological Gaucher disease.

Orphazyme expects to file an application for marketing approval for the drug for NPC in Europe before year end.