Pittsburgh’s Noveome Biotherapeutics closed $20.7M of a Series E

A Strip District-based biopharmaceutical company just raised the first half of what could be one of Pittsburgh’s largest rounds of 2023.

Noveome Biotherapeutics is producing a treatment for necrotizing enterocolitis, a rare gastrointestinal disease that impacts pediatric patients. After years of development, the company’s cell-free platform biologic, ST266, is ready for clinical trials.

On Thursday, its leadership announced the trials will be funded with a $40.2 million Series E raise, of which it recently closed just over $20 million.

“The funding is critical for us to initiate and complete a clinical trial in neonates who suffer from necrotizing enterocolitis,” Noveome Chairman Ron Poropatich told Technical.ly.

The funding was secured in a financing round led by MAK Capital and a few other unnamed investors. Prior to this raise, Noveome raised a total of $170 million from both private investors and from the Department of Defense, the Commonwealth of Pennsylvania and Allegheny County. The company currently has access to the first $20.7 million, with the expectation that it’ll close the second half of the Series E round no later than Dec. 31, 2023.

The raise so far is already about as much as Pittsburgh’s biggest raise of the year — $21 million for ECM Therapeutics, as recorded by the latest Venture Monitor report.

With the money in hand, Noveome will fund its trials and bring on additional employees. The positions the company is looking to fill include manufacturing jobs and lab workers, per Poropatich; the goal is to keep the clinical trial Pittsburgh local. To date, Noveome employs 14 workers in Pittsburgh in its Strip District office and one in Florida, including IT support, manufacturers, and a chief scientist.

“We have plans to hire based on this new round of funding five additional employees to start and to begin a clinical trial later this year on necrotizing enterocolitis, across a number of neonatal sites in the country, to recruit young babies into the study, and to do the clinical testing in those babies under an institutional review board and IRB protocol,” Poropatich said.

Poropatich added that the company’s leadership has already reached out to the FDA and has a clinical research organization in place to help manage the science and ensure that the trial is run safely and equitably.

The chairman noted that necrotizing enterocolitis impacts an especially vulnerable population — premature babies — and this particular disease hasn’t had a new breakthrough therapy to treat it in roughly 30 years. Poropatich said Noveome’s researchers can extract human placenta’s anti-inflammatory properties and use them to treat this disease, which causes the gastrointestinal tract not to develop fully. In the absence of long-term treatment, necrotizing enterocolitis can lead to a lifetime of surgeries and a 30% chance of mortality, he said.

“There are developmental problems, they don’t grow as big and as tall and as healthy as they can, because they don’t absorb as much of the nutrients,” Poropatich said. “It’s an undertreated population and I think that’s really important to understand.”