Galecto Acquires Damora Therapeutics, Fueling Novel Approach to Rare Blood Disorder Treatment

Waltham, MA – November 10, 2024 – Galecto, Inc., a clinical-stage biopharmaceutical company, today announced the acquisition of Damora Therapeutics, a portfolio company of Paragon Therapeutics, in a deal designed to advance a targeted therapy for Myeloproliferative Neoplasms (MPNs) driven by the calreticulin (CALR) mutation. The acquisition is accompanied by a substantial funding round, bolstering Galecto’s resources and paving the way for clinical development of Damora’s lead asset, DMR-001.

The deal underscores a rising trend in biotech – the “venture studio” model exemplified by Paragon Therapeutics – which rapidly launches and funds independent companies focused on specific drug programs. This approach appears to be gaining traction, with Paragon’s portfolio companies attracting significant investment and achieving successful public offerings.

Targeting the Root of Rare Blood Disorders

MPNs are a group of rare blood cancers that disrupt the normal production of blood cells. Approximately 42,000 patients in the U.S. harbor the CALR mutation, a driver of the disease in a subset of MPN patients. Current treatment options often manage symptoms but lack disease-modifying effects and can carry significant side effects. DMR-001, an anti-CALR monoclonal antibody, aims to address this unmet need by directly targeting the mutant protein expressed exclusively in malignant cells.

“The specificity of DMR-001 is a key advantage,” explains one industry analyst. “By targeting a mutation unique to cancer cells, the therapy has the potential to minimize off-target effects and maximize efficacy.”

The acquisition of Damora and the development of DMR-001 represents a significant shift towards precision medicine in MPN treatment. Unlike broad-acting therapies, DMR-001 is designed to selectively kill cancer cells while sparing healthy tissue.

Paragon’s ‘Venture Studio’ Model Gains Momentum

Paragon Therapeutics, founded in 2021, operates as a discovery engine for best-in-class biologics. The company identifies promising therapeutic concepts and then spins them out into independent biotech companies, each focused on a specific drug program. This ‘hub-and-spoke’ model allows for dedicated resources and faster development timelines.

“The Paragon model is a fascinating approach,” notes a venture capital investor familiar with the company’s strategy. “By spinning out individual companies, they can attract specialized funding and expertise for each program. This allows for more efficient development and potentially higher returns.”

Paragon’s portfolio includes several successful spinouts, including Apogee Therapeutics, which completed an IPO just seven months after launch, and Oruka Therapeutics, which recently secured $275 million in funding. The company’s track record demonstrates the viability of its venture studio approach and its ability to generate value for investors.

“The success of Apogee, Spyre, and Oruka has validated the Paragon model,” says a biotech analyst. “These companies have attracted significant investment and achieved rapid growth, demonstrating the potential for this approach to disrupt the traditional biotech landscape.”

Galecto’s Strategic Vision

Galecto, known for its work in fibrosis and cancer, sees the acquisition of Damora as a strategic move to expand its pipeline and address unmet needs in hematological malignancies. The company plans to leverage its expertise in antibody development and clinical trial management to accelerate the development of DMR-001.

“We are excited to bring DMR-001 into our pipeline,” said Hans T. Schambye, President and CEO of Galecto, in a press release. “This acquisition aligns with our commitment to developing innovative therapies for patients with serious diseases.”

Several members of Fairmount, the firm that founded Paragon, will be joining Galecto’s board of directors, signifying a strong strategic alignment and integration of expertise. This move suggests a long-term commitment to the development of DMR-001 and a belief in the potential of the therapy to transform the treatment of CALR-mutated MPNs.

“The involvement of Fairmount on Galecto’s board is a positive sign,” explains an industry insider. “It demonstrates a long-term commitment to the program and a belief in the potential of the therapy.”

Looking Ahead: Clinical Development and Beyond

With funding secured and a clear path forward, Galecto plans to initiate Phase 1 clinical trials for DMR-001 in the coming months. The company is optimistic about the potential of the therapy to improve the lives of patients with CALR-mutated MPNs and is committed to advancing the program through clinical development.

“We are confident that DMR-001 has the potential to become a best-in-class therapy for CALR-mutated MPNs,” says one Galecto scientist. “We are excited to bring this innovative therapy to patients in need.”

The acquisition of Damora by Galecto and the rise of Paragon’s venture studio model represent a significant shift in the biotech landscape. By focusing on targeted therapies and embracing innovative business models, these companies are paving the way for a new era of precision medicine and are bringing hope to patients with rare and challenging diseases.