A life sciences startup co-founded by a former Procter & Gamble researcher has closed a multimillion-dollar funding round led by local angel capital investment group Queen City Angels.
Alphyn Biologics, a clinical-stage dermatology company based in Cincinnati and Annapolis, Md., announced Thursday an oversubscribed $3.3 million Series A. Queen City Angels, one of the oldest organized angel groups in the Midwest, led the round, with participation from Angel Physicians Fund, a seed-stage investor group headed by St. Elizabeth Healthcare oncologist Dr. Manish Bhandari, and Ohio-based Serial Stage Venture Partners.
Alphyn, which went operational in 2020, is developing a new class of drugs for skin diseases, including eczema. Officials at the company have been intentionally quiet since its launch, President Steven Pentelnik said. Pentelnik is one of four co-founders, three of which live in Cincinnati.
Pentelnik spent 35 years at Cincinnati-headquartered P&G, where he was responsible for its $1 billion early-stage technology portfolio and served as global manager of its $750 million beauty care products business, before jumping into the startup space in 2012.
Alphyn is his third such startup — and builds on the skin care knowledge he gleaned while at P&G. The company said the new financing will support a Phase 2a clinical trial for AB-101a, its lead candidate for the treatment of mild-to-moderate atopic dermatitis, or AD, considered the most common form of eczema.
It's a condition that affects millions worldwide.
“This is a huge market opportunity,” Pentelnik told me. “It’s a devastating disease — our goal is to exit as soon as we can to a large pharma company. We can do the science, but to really get product into the marketplace, we’re looking to leverage their distribution talents.”
AB-101a, a non-steroidal, is expected to be the first “atopic dermatitis treatment” with the ability to target the disease's bacterial and immune system components. It’s in development stage to treat the inflammation, itch, and uniquely, the bacterial causes commonly associated with AD, including infection. AB-101a targets common bacteria such as staph and highly drug-resistant methicillin-resistant staph (MRSA) that worsen AD and prevent its healing.
As a "4-in-1" solution, AB-101a would enable AD to be treated with a single therapeutic rather than multiple drugs.
Its being studied for use in pediatrics, starting at age 2, as well as in adult populations.
"Current atopic dermatitis treatments are plagued with numerous safety and side effect problems," Tony Shipley, chair and co-fund manager of Queen City Angels, said in a release. "AB-101a is urgently needed."
Alphyn made the Queen City Angels connection via Norwood-based Alloy Development, formerly HCDC, Pentelnik said. The company has also made several key local connections and has built a network of great mentors, he said.
Alphyn CEO Neal Koller said the Series A allows the company to begin an “accelerated global multi-center clinical trial program.” That will support a new drug application with the U.S. Food & Drug Administration and other national health authorities.
The company is already making preparations to raise a Series B, although the timing, and exact amount, is still unknown.
"We are honored to close this round having passed the rigorous due diligence processes of three professional investment funds that understand the urgent need for a treatment for AD," Koller said.
Alphyn, to date, has raised around $6.7 million in funding. Participants in previous rounds include family office investment funds, a corporate fund and professional high-net-worth investors.
