WSU neurodegenerative disease drug spinout Athira Pharma will put the proceeds towards phase 2/3 clinical testing of a treatment for Alzheimer's disease.

Athira Pharma, a US-based neuro-regenerative therapy developer spun out of Washington State University, yesterday completed an $85m series B round led by investment firm Perceptive Advisors.

Asset management firms RTW Investments and Franklin Templeton participated in the round, as did hedge fund Viking Global Partners, investment firm Rock Springs Capital and Venrock Healthcare Capital Partners, a fund raised by venture firm Venrock.

The deal was rounded off by LifeSci Venture Partners, Surveyor Capital, Highside Capital Management, Logos Capital, Sofinnova Investments, Avidity Partners, Sahsen Ventures and individuals Rick and Suzanne Kayne, as well as undisclosed existing investors.

Founded in 2011 as M3 Biotechnology, Athira Pharma is progressing a clinical-stage small molecule drug called NDX-1017 with potential to combat neurogenerative diseases Alzheimer’s and Parkinson’s, for which existing treatments offer only symptomatic relief.

The spinout’s pipeline also includes pre-clinical programs for other central nervous system (CNS)-related disorders, in addition to discovery-stage work on both CNS and non-CNS indications.

Athira Pharma’s approach seeks to bolster naturally-occuring repair mechanisms to improve neuronal health and brain function, restoring lost connections in the patient’s brain.

Proceeds from the series B round will enable it to launch a phase 2/3 clinical trial of NDX-1017 for Alzheimer’s patients. Joseph Edelman, CEO and portfolio manager of Perceptive Advisors, has joined the company’s board of directors.

Athira Pharma is led by its CEO and president Leen Kawas, a former research associate at Washington State University who helped found the company.

WRF Capital, the early-stage arm of commercialisation firm Washington Research Foundation, backed a $10m round for Athira Pharma closed in 2016 that was led by angel investors Bruce and Michael Montgomery.

Women and diversity-focused vehicle W Fund also backed the round, before a $1.4m investment from nonprofit organisation Alzheimer’s Drug Discovery Foundation (ADDF) in 2017. ADDF was described as being Athira’s first investor, though further details could not be confirmed.

Joseph Edelman said: “NDX-1017 represents a novel mechanism for treating Alzheimer’s patients and we are very excited to invest in Athira.

“Athira has assembled an impressive and seasoned management team with years of CNS drug development experience, and we look forward to supporting an innovative company focused on devastating neurological diseases.”