Ligand Pharmaceuticals has invested $50 million and led a syndicate of co-investors, including Paragon Biosciences, Valor Equity Partners, and XOMA Royalty Corporation, in a $25 million royalty financing agreement with Castle Creek Biosciences. This funding will support the Phase 3 clinical trial of Castle Creek’s lead gene therapy candidate, D-Fi (FCX-007), for the treatment of dystrophic epidermolysis bullosa (DEB). In return, the investors receive a high-single-digit royalty on future global D-Fi sales.
This investment underscores growing confidence in the potential of D-Fi to address the significant unmet medical need in DEB, a rare and debilitating genetic skin disorder. Successfully completing the Phase 3 trial is crucial for Castle Creek as it represents a major step toward commercialization and potentially delivering a transformative treatment to patients. The involvement of prominent investors like Ligand, Paragon, Valor, and XOMA further validates the therapeutic promise of D-Fi and its market potential. For Ligand, this deal represents a strategic move to diversify its revenue streams through royalties on a promising late-stage asset.
The Phase 3 trial will evaluate the efficacy and safety of D-Fi, an autologous gene-modified cell therapy designed to correct the underlying genetic defect responsible for DEB. The therapy involves modifying a patient’s own skin cells to produce functional type VII collagen, a protein crucial for skin integrity. Early clinical data suggests D-Fi is generally well-tolerated, with injection site reactions being the primary adverse event. The FDA has granted D-Fi Orphan Drug, Rare Pediatric Disease, Fast Track, and Regenerative Medicine Advanced Therapy designations, highlighting the therapy’s potential and the urgent need for effective DEB treatments.
This investment positions D-Fi for a critical stage of development. Positive Phase 3 results could pave the way for regulatory approval and significantly improve the treatment landscape for DEB patients. Success would represent a landmark achievement for Castle Creek, its investors, and the field of gene therapy, demonstrating the potential of this approach to address rare genetic diseases. This also holds long-term financial implications for Ligand and strengthens its royalty portfolio.
Jon Napitupulu is Director of Media Relations at The Clinical Trial Vanguard. Jon, a computer data scientist, focuses on the latest clinical trial industry news and trends.
