Otonomy, the San Diego biopharmaceutical startup developing new treatments for diseases and disorders of the ear, has refined its strategy, raised capital, and advanced three drug candidates in the three and a half years since David Weber stepped in as CEO.
And today Otonomy says it has secured $49 million in a new Series D round of financing that strengthens the balance sheet, diversifies Otonomy’s pool of investors, and moves the six-year-old startup closer to becoming a pre-commercial specialty drug company.
The latest financing brings the total capital raised by Otonomy to $144 million since 2008, and adds some institutional investors to the mix.
The newest investors include Jennison Associates, which invested on behalf of clients, Perceptive Advisors, the Federated Kaufmann Funds, Ally Bridge Group, certain private funds advised by Clough Capital Partners, and other unnamed institutional investors. All existing investors participated as well, including OrbiMed Advisors, Novo Ventures, TPG Biotech, Avalon Ventures, Domain Associates, RiverVest Venture Partners, Aperture Venture Partners, and Osage University Partners.
Proceeds from the round will be used mostly to advance Otonomy’s pipeline of products, which has been shuffled around in priority (see below) since Weber took over in late 2010. At that time, Otonomy had about 11 employees, Weber said. Today the company has 35, which is a reflection of the increasing number of drug candidates as well as the late-stage nature of Otonomy’s drug development, he said.
When Weber took over, Otonomy’s lead drug candidate, OTO-104, was in an early stage trial for use in patients with Meniere’s disease, a fluid imbalance of the inner ear that can cause dizziness and gradual hearing loss. OTO-104 is a formulation of the steroid dexamethasone in a gel that can be injected into the middle ear cavity.
“The gel holds the drug in the middle ear, and allows the drug to be solubolized [and absorbed] over time,” Weber said, easing symptoms of
