Kailera Therapeutics comes out of stealth with $400 million for obesity drugs

In a year when metabolic diseases have drawn significant investor interest, the newest player has big-name backing, a sizable war chest and experienced leadership.

Kailera Therapeutics, details of which were first revealed in May under the name “Hercules CM NewCo,” emerged from stealth on Tuesday with plans to develop a portfolio of GLP-1 drugs for obesity and other metabolic diseases. The drugs were acquired from Jiangsu Hengrui Pharmaceuticals Co., which had already completed initial clinical trials in China for what is now Kailera's lead program, an injectable drug called KAI-9531.

“We have an incredible opportunity to develop next-generation treatments for chronic weight management and help people restore their health and live their lives to the fullest,” said Ron Renaud, a prominent biotech executive who has become CEO of Kailera is.

KAI-9531, which targets the hormone receptors GLP-1 and GIP, is being tested in people with obesity and type 2 diabetes. A subsidiary of Jiangsu Hengrui was expected to complete a Phase 2 trial of the type 2 diabetes drug earlier this year and is currently conducting two ongoing trials to treat obesity.

Kailera has three additional GLP-1 agonists in development, including KAI-7535, which is in clinical testing, and two preclinical compounds.

Although the GLP-1 space is dominated by Novo Nordisk and Eli Lilly, rival pharmaceutical and biotech companies are equally working quickly to develop competitors. For example, Roche and Viking Therapeutics are each developing drugs that target GLP-1 and GIP, the hormones targeted by Lilly's Zepbound.

And over the past two years, startups like OrsoBio, SixPeaks Bio and BioAge Labs have raised notable private funding and caught the attention of pharma partners. BioAge's recent IPO performance, which shifted from age-related diseases to anti-obesity drug discovery, has also shown investor confidence in the prospects of this new wave of metabolic drugs.

Renaud, a longtime fixture in the biotech industry, sold his previous three companies: Idenix Pharmaceuticals, which was purchased in a deal with Merck & Co. in 2014; Translate Bio, purchased by Sanofi in 2021; and Cerevel Therapeutics, acquired by AbbVie in 2023.

Kailera's early investors include Atlas Venture, Bain Capital, RTW Investments and Lyra Capital. In May, the venture firms formed the company and licensed Hengrui's drug candidates for $110 million in upfront and short-term payments, as well as about a 20 percent equity stake, a filing said. Bain Capital, where Renaud is a partner, held the largest stake in Kailera at 39% in May.

Joining Renaud on Kailera's leadership team is John Milligan, former CEO of Gilead Sciences, as chairman.