Verge Analytics, Inc.

Verge intends to use a “leaner cost structure” and continued investment in its technology to scale up its machine learning model, Converge, as a means to achieve profitability.\n After taking a shot at becoming a neuroscience biotech, buzzy Bay Area AI outfit Verge Genomics is dropping its only clinical asset and returning to its drug discovery roots.The decision comes after VRG50635, the company’s lead asset for amyotrophic lateral sclerosis (ALS), failed a pre-specified efficacy analysis in a phase 1 trial, Effie Bruzik, Verge’s vice president of operations, told Fierce Biotech.“A no-go decision was made,” Bruzik said, so the trial was terminated and did not advance to an open-label extension stage. On clinicaltrials.gov, the reason given for the termination is “lack of risk-benefit data.”The move away from VRG50635 leaves a preexisting deal with Ferrer in limbo. The Spanish pharma licensed the ex-U.S. rights to the ALS asset in March 2024 in a pact potentially worth more than 112.5 million euros (then worth roughly $121.7 million).Bruzik did not respond to questions from Fierce Biotech about the status of Verge’s deal with Ferrer. At the time of publication, Ferrer had not responded to Fierce\'s request for comment. With no more candidates in the clinic, Verge is pivoting to focus solely on its machine learning drug discovery platform Converge, Bruzik added.“Recent breakthroughs in AI foundation models has meaningfully increased demand for Verge’s multi-modal human datasets in the last 18 months, and we see a clear opportunity to drive industry-wide impact by enabling partners to improve pipeline success rates,” Bruzik said.Verge intends to use a “leaner cost structure” and continued investment in its technology to scale up Converge as a means to achieve “sustainable profitability,” Bruzik explained. The company plans to divulge more details on the “strategic re-focus,” including new hires, early next year, she said. VRG50635 itself was originally discovered with Converge, and the tech company’s success at bringing an AI-discovered candidate into the clinic earned Verge a spot on the Fierce 15 list in 2022.Founded in 2015, Verge raised a  $32 million series A  in 2018 and then tripled it to $98 million for a December 2021 series B that saw Eli Lilly and Merck pitch in.Lilly was already a known friend of Verge, dropping $25 million upfront on the AI company in July 2021 to pursue new ALS candidates. AstraZeneca followed with $42 million for an R&D pact of its own in September 2023. 

Verge Genomics’ sole clinical-stage drug has failed, and the California biotech will shift to a partnership model for its AI-driven discovery platform, Endpoints News has learned. The biotech’s VRG50635 did not meet the bar for efficacy in a Phase 1b in patients with amyotrophic lateral sclerosis, Verge CEO Alice Zhang said in an emailed statement on Tuesday. She said the biotech will publish the full study results in the first half of next year. The trial was completed “as designed,” Zhang said, but it was terminated, according to an update posted to the US federal trials database on Monday. With that, the decade-old biotech will “focus solely” on its AI platform that uses a “proprietary multi-modal molecular and clinical dataset derived directly from patient tissue,” Zhang said. She said there’s been increased demand for its datasets and that the shift will help partners “improve pipeline success rates.” The decision marks a key pivot for the biotech, which formed in 2015 with ambitions to create new medicines based on human genomics. Verge had broad plans for its pipeline, with at least 15 different diseases listed on its website. It was conducting research in neurodegenerative disorders, metabolic conditions, immunology and rare disease. A CD38 enzyme inhibitor for weight management was slated to enter the clinic earlier this year, but doesn’t appear to have done so. Zhang said the move positions Verge to continue investing in its “AI, product, and engineering capabilities,” and will lead to a “leaner cost structure” and extended cash runway. More details about the strategic shift, including updates on Verge’s pipeline and “key hires,” will be disclosed in early 2026, Zhang said. Most of Verge’s C-suite has left in the past 20 months, with chief financial, scientific and medical officers all departing, according to their LinkedIn profiles. President and CBO Jane Rhodes left last year to become CEO of neuro biotech AstronauTx. Verge has not announced a financing round since a $98 million Series B in December 2021. Since then, though, it has forged partnerships with Ferrer and AstraZeneca’s Alexion . Shortly before the Series B, it teamed up with Eli Lilly . Ferrer and Verge outlined a collaboration on VRG50635 last year. The Spanish pharma and Verge said in March 2024 they would co-develop the small molecule PIKfyve inhibitor in Europe, Central and South America, Southeast Asia and Japan. The status of that collaboration, following the trial termination, is unclear. A Ferrer spokesperson didn’t respond to an inquiry from Endpoints.

Aeovian Pharmaceuticals has collected $55 million to see if it can prove its mTORC1 approach in tuberous sclerosis complex and consider getting into obesity with another mechanism. The Series B, disclosed Tuesday, will fuel the completion of a Phase 2 of an oral mTORC1 inhibitor in patients with tuberous sclerosis complex (TSC)-related epilepsy, as well as preclinical work in other neurodegenerative diseases. In TSC, the rare genetic disorder leads to non-cancerous tumors in various organs. Investors include Luma Group, CTI Life Sciences Fund, Foresite Capital, TSC Alliance Endowment Fund, Sofinnova Investments and venBio, among others. The company last disclosed a $50 million round led by Hevolution in March 2024. Aeovian plans to initiate the Phase 2 of AV078 early next year and report data about 18 months later, CEO Allison Hulme told Endpoints News in an interview. The trial will enroll in the US, Canada, UK, Europe and Australia, she said. “Epilepsy still exists in TSC. We have not wiped that out,” TSC Alliance CEO Kari Rosbeck said in a separate interview. Aeovian’s AV078 is the first clinical-stage drug to have come out of the TSC’s preclinical consortium, Rosbeck said. About a dozen other experimental medicines in the consortium are moving towards clinical development, she said. With “current treatments, if you go from 50 seizures down to 15, it’s still not ideal, you’re still quite incapacitated. So can you dose higher, get those seizures further down?” said Themasap Khan, co-founder and partner of Luma Group, the co-lead investor in Aeovian’s Series B. “That just got us very, very excited.” Multiple drugmakers over the years have been interested in mTORC, which is the molecular target of rapamycin, the immunosuppressant that has been around for a quarter of a century. But pharma companies have run into roadblocks over the years, as many of the candidates have not been selective enough to mTORC1, Hulme said. Companies in the mTORC1 space have included Novartis , Supernus and Johnson & Johnson. J&J acquired Anakuria Therapeutics and its candidate AT-20494 for undisclosed terms in 2022. By being brain-penetrant and selective to mTORC1, Aeovian expects AV078 to be more effective and less toxic. “We clearly showed in our non-clinical tox programs that we were differentiating from those non-selective mTOR inhibitors like rapamycin and everolimus,” Hulme said. Everolimus, also known as Novartis’ Afinitor, was the first drug to receive approval for TSC patients in 2010, for treating subependymal giant cell astrocytomas, or SEGAs. While Aeovian’s initial clinical focus is on epilepsy, the nine-employee biotech has broader ambitions for treating TSC. “Ultimately, we should be able to become the TSC drug of choice,” Hulme said. “We should be able to treat the other manifestations of tuberous sclerosis complex with this particular lead compound,” she said, pointing to SEGAs as an example. Aeovian also has a peripheral mTORC1 inhibitor, AV505, that could be applied to metabolic diseases and autosomal dominant polycystic kidney disease. The California biotech is also in the preclinical stages on CD38 enzyme inhibitors. The CD38 research could lead to potential treatments for Duchenne muscular dystrophy, obesity, MASH and other areas, Hulme said. Verge Genomics has preclinical CD38 program for weight maintenance. “This round has gone up, up and up multiple times, and now [Aeovian] has enough resources to put some capital toward the 38 [program],” Khan said in an interview. “We have to see where that data plays out. They’re pretty quick and dirty experiments we can run for a pretty limited budget, and then if those look good, it could be very exciting in many ways for the company to continue to build that out, but we have to see.”