MPM BioImpact and Novo Holdings are among a group of investors pouring $103 million into a psychedelic biotech that MPM took private last summer.
Reunion Neuroscience, a Morristown, NJ-based biotech, unveiled its new life as a private company on Thursday morning with the Series A financing. It had originally targeted $80 million for the round, but investor interest picked up, CEO Greg Mayes told Endpoints News.
Investors and biotechs are increasingly interested in psychedelics as medicines, driven in part by the hope that they can do a better job treating patients than decades-old SSRIs and other antidepressants. A potential FDA approval in August for Lykos Therapeutics’ MDMA-assisted depression treatment is being watched as a bellwether moment for the field. Lykos and Reunion are among the 33 drug discovery and development startups to have disclosed nine-figure private financing rounds so far this year, per an Endpoints tally.
At the same time, pharma is striding back into neuroscience. Bristol Myers Squibb and AbbVie are dishing out billions of dollars to acquire CNS drug developers, and smaller biotechs like Engrail and Seaport are reeling in large financings for new medicines.
With the new money, Reunion plans to run three Phase 2 trials in postpartum depression, adjustment disorder in cancer and a to-be-determined mental health indication, Mayes said. The capital injection is set to bankroll the startup into 2027.
Reunion was once part of Field Trip Health, a chain of Canadian clinics that provided psychedelic care, until the drug discovery unit split off in 2022 as an independent public company. Then, in August, MPM took the company private. Mayes, who became Reunion’s CEO in October 2022 after having led hepatitis B biotech Antios Therapeutics, called it a “very unique and novel transaction idea.” Like many small biotechs, Reunion struggled to weather the public markets last year.
“As you know and the world knows, biotech fundraising was at a low point or most challenging point in time in the 2022 to 2023 period,” Mayes said.
Aside from MPM and Novo Holdings, Reunion’s other investors include Arkin Bio Ventures, Mitsui & Co. Global Investment, Plaisance Capital, FemHealth Ventures and Palo Santo.
Multiple trials
Reunion is currently in “study startup” mode for its Phase 2 in postpartum depression, Mayes said. The company is testing a single dose of RE104, a serotonergic psychedelic drug candidate that is injected under the skin. RE104 is a prodrug of the synthetic psychedelic 4-OH-DiPT and goes after the serotonin 2A receptor. Patients will be in the clinic for about half a day for monitoring.
The biotech hopes RE104 will have a more rapid effect than Zurzuvae. That medicine, which is marketed by Sage and Biogen, takes several days to work. The trial is expected to involve 35 to 40 sites in the US and wrap up in the second quarter of 2025.
Meanwhile, the company also plans to test RE104 in cancer patients with adjustment disorder, in which people with a cancer diagnosis experience anxiety and/or depression. A trial is expected in early 2025, Mayes said. There are no approved products in the US for that indication.
“The background on adjustment disorder in cancer patients really dates back to the psychedelic renaissance in clinical development, and in fact the renaissance of psychedelics post-the federal government’s ‘war on drugs,’” Mayes said.
More recently, some academic centers, like Johns Hopkins, have tested psychedelics in cancer patients whose mental health waned.