Karuna

Advancing transformative medicines for people living with psychiatric and neurological conditions

< FOUNDED ENTITIES

Advancing transformative medicines for people living with psychiatric and neurological conditions

2.8% Equity plus Milestone Payments/ 20% Sublicense Revenue/ Royalties & up to $500M from agreement w/Royalty Pharma³

PHASE 3

Description

Advancing transformative medicines for people living with psychiatric and neurological conditions

Puretech Ownership¹

2.8% Equity plus Milestone Payments/ 20% Sublicense Revenue/ Royalties & up to $500M from agreement w/Royalty Pharma³

Stage of Development

PHASE 3

¹ As of October 31, 2023, PureTech’s percentage ownership of Karuna was approximately 2.8% on an outstanding voting share basis. As of March 22, 2023, PureTech has sold its right to receive a 3% royalty from Karuna to Royalty Pharma on net sales up to $2 billion annually, after which threshold PureTech will receive 67% of the royalty payments and Royalty Pharma will receive 33%. PureTech retains its equity ownership in Karuna. Additionally, under its license agreement with Karuna, PureTech retains the right to receive milestone payments upon the achievement of certain regulatory approvals and 20% of sublicense income.

Advancing transformative medicines for people living with psychiatric and neurological conditions

Karuna Therapeutics is a clinical-stage biopharmaceutical company driven to create and deliver transformative medicines for people living with psychiatric and neurological conditions.

Program Discovery Process by the PureTech Team
- We and our collaborators, including leading schizophrenia experts, were excited about efficacy data generated in schizophrenia and Alzheimer’s disease by Eli Lilly with xanomeline, which had notable efficacy stemming from its activation of muscarinic receptors (M1 and M4) but had been held back by gastrointestinal tolerability issues. To overcome this, we invented KarXT, an oral M1/M4-preferring muscarinic agonist, by combining xanomeline (a muscarinic agonist) with trospium (a peripherally acting muscarinic antagonist that doesn’t cross the blood brain barrier). This enabled the beneficial effects of M1/M4 activation in the brain without the peripheral side effects. We conducted key human tolerability proof-of-concept studies with KarXT that allowed Karuna to advance it further in schizophrenia patients. Karuna licensed the key KarXT intellectual property from PureTech. If approved, we would have pioneered the development of the first new class of medicine for schizophrenia in over 50 years.
Milestones Achieved & Developmental Status
- In September 2023, Karuna announced the submission of a New Drug Application to the U.S. Food and Drug Administration for KarXT for the treatment of schizophrenia.
- In August 2022, Karuna announced positive results from the Phase 3 EMERGENT-2 trial evaluating the efficacy, safety and tolerability of its lead investigational therapy, KarXT (xanomeline-trospium), in adults with schizophrenia. The trial met its primary endpoint, with KarXT demonstrating a statistically significant and clinically meaningful 9.6 point reduction in Positive and Negative Syndrome Scale (PANSS) total score compared to placebo (-21.2 KarXT vs. -11.6 placebo; p<0.0001) at Week 5 (Cohen’s d effect size of 0.61). KarXT also met key secondary endpoints. KarXT was generally well tolerated, with a side effect profile substantially consistent with prior trials of KarXT in schizophrenia.
- In November 2023, Karuna announced the Phase 3 ADEPT-2 and ADEPT-3 trials for psychosis in Alzheimer’s disease initiated in Q3 2023.
- In March 2023, Karuna announced positive topline results from the Phase 3 EMERGENT-3 trial evaluating the efficacy, safety, and tolerability of its lead investigational therapy, KarXT (xanomeline-trospium) in adults with schizophrenia. The trial met its primary endpoint, with KarXT demonstrating a statistically significant and clinically meaningful 8.4-point reduction in Positive and Negative Syndrome Scale (PANSS) total score compared to placebo (-20.6 KarXT vs. -12.2 placebo; p<0.0001) at Week 5 (Cohen’s d effect size of 0.60). Consistent with prior trials, KarXT demonstrated an early and sustained statistically significant reduction of symptoms from Week 2 (p<0.05) through the end of the trial as assessed by PANSS total score. KarXT also demonstrated reductions in positive and negative symptoms of schizophrenia as measured by PANSS positive and PANSS negative Marder factor subscales. KarXT was generally well tolerated, with a side effect profile substantially consistent with previous trials of KarXT in schizophrenia.
- In the first quarter of 2023, Karuna initiated a Phase 1b Ambulatory Blood Pressure Monitoring trial to further characterize the impact of KarXT on blood pressure.
- In August 2023, Karuna announced the initiation of the ADEPT-3 open label extension trial in psychosis in Alzheimer’s Disease (AD).
Expected Milestones
- Karuna submitted a New Drug Application to the FDA for KarXT in schizophrenia, and expects a potential approval and launch in the second half of 2024.
- Karuna anticipates topline data from the Phase 3 ARISE trial in patients with schizophrenia in the second half of 2024.
- Karuna anticipates topline data from the Phase 1b trial evaluating the effect of KarXT on 24-hour ambulatory blood pressure in adults with schizophrenia in Q4 2023.
- Karuna expects to initiate a Phase 1b clinical trial of KAR-2618 for the treatment of major depressive disorder in 2024
- Topline data from the EMERGENT-4 and EMERGENT-5 trials evaluating the long-term safety of KarXT in schizophrenia are anticipated in the second half of 2024.
- Karuna anticipates topline data from the Phase 3 ADEPT-1 and ADEPT-2 trials in patients with psychosis related to Alzheimer’s disease in 2025.

Note: Karuna has an active IND on file with the FDA for KarXT. Karuna also has ongoing discovery efforts to expand its pipeline. We do not control the clinical or regulatory development of Karuna’s product candidates. We do not have any board designees on Karuna’s board of directors, and we are not responsible for the development or commercialization of its therapeutic candidate. As of March 22, 2023, PureTech has sold its right to receive a 3% royalty from Karuna to Royalty Pharma on net sales up to $2 billion annually, after which threshold PureTech will receive 67% of the royalty payments and Royalty Pharma will receive 33%. PureTech retains its equity ownership in Karuna. Additionally, under its license agreement with Karuna, PureTech retains the right to receive milestone payments upon the achievement of certain regulatory approvals and 20% of sublicense income. Karuna is well-protected with a robust intellectual property portfolio. The disclosure above is qualified in its entirety by reference to Karuna’s public filings with the SEC. Karuna was incorporated in July 2009.

The key innovation behind the KarXT, which was invented at PureTech, was built around two validated drugs: xanomeline, a novel muscarinic agonist, and trospium, an approved muscarinic antagonist. We were able to ameliorate the GI tolerability issues of xanomeline by pairing it with a gut-restricted muscarinic antagonist to develop a novel formulation that enabled a new approach for the potential treatment of schizophrenia and other serious psychiatric and neurological conditions, an area of major unmet need. KarXT now represents a potential first-in-class and best-in-class therapy for schizophrenia.