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Israeli biotech Ayala Pharmaceuticals, founded last year as a development vehicle for two of Bristol-Myers Squibb’s cancer candidates, has raised $17 million in a series A financing.


The new company licensed rights to BMS’s gamma secretase inhibitor BMS-906024 in December, saying it intends to develop the lead drug as a precision medicine for patient populations with diseases affected by Notch activating mutations, including cancer. The deal also included a follow-up drug in the same “pan-Notch inhibitor” class (BMS-986115), and involved an undisclosed upfront fee to BMS plus milestones and royalties. Both the drugs have passed though phase 1 testing.


A spokesperson for Ayala tells us that the new funding will be used to take BMS-906024 (now rechristened AL101) through a phase 2 trial in recurrent or metastatic adenoid cystic carcinoma (ACC) patients with activated Notch pathway that is due to get started in the second half of this year. ACC is a rare cancer most commonly affecting the salivary glands in the head and neck, and has no approved therapies and a poor response to available treatments.


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The cash injection will also be used to conduct preclinical research to characterize additional indications for which AL101 may be effective, as well as license another product candidate, she adds. The Series A is being led by Israel Biotech Fund, which was instrumental in setting up the company last year along with aMoon and Harel Insurance that have also participated in this round.


Mutations in the Notch pathway are known to play a big role in a variety of cancers, but developing drugs against the target has been challenging, in part because a lack of selectivity among candidates has resulted in dose-limiting side effects. In 2016 for example OncoMed was forced to halt a phase 2 trial of its Notch drug tarextumab after poor results, subsequently abandoning the drug, while in the prior year Roche pulled gamma secretase inhibitor RO4929097 after a mid-stage trial miss.


Discussing Ayala’s plans when the company launched last year, chairman David Sidransky, M.D., said that BMS-906024 looks like a “best in class gamma secretase inhibitor”, adding that it has a strategy it hopes will unlock the potential of the drug in Notch-mutated cancers.


“Although most Notch targeted clinical trials have traditionally recruited non-selected populations, our approach is to target patients with specific Notch alterations whose tumors are expected to respond directly to this treatment,” he said.