Regeneron Acquires Hearing Loss Biotech in $213M Deal

(GDJ, Pixabay. https://pixabay.com/vectors/wave-waveform-aural-audio-sonic-1837426/)

9 Aug. 2023. Regeneron Pharmaceuticals, a maker of synthetic biologic treatments, is acquiring Decibel Therapeutics, developer of gene therapies to treat hearing loss and balance disorders. The deal is expected to bring Decibel Therapeutics shareholders as much as $213 million if all terms of the agreement are fulfilled.

Decibel Therapeutics is an eight year-old biotechnology enterprise founded by researchers in neuroscience and speech and hearing anatomy at Harvard Medical School, Johns Hopkins University, and University of Michigan. The research behind the company’s technology identifies genetic variations associated with hearing loss and balance disorders, often linked to the aging process or injury. In this case, however, Decibel seeks to restore normal hearing and balance by transferring functioning genes to regenerate sensory tissue and hair cells in the cochlea, the spiral section of the inner ear where sound waves are converted into nerve impulses.

The company says its process aims to model the development of human cells involved in hearing and balance. Decibel says it isolates genetic activity at a granular single-cell resolution, then with the aid of bioinformatics, designs treatments that regenerate progenitor cells into sensory tissue and hair cells to restore normal hearing and balance. For example, outer hair cells in the ear act as amplifiers of sound into the ear, but are often lost as a result of aging. Restoring outer hair cells is one of Decibel’s treatment objectives.

Mutations associated with inherited hearing loss

Decibel Therapeutics also addresses hearing loss from genetic causes in children. The company’s lead product, code-named DB-OTO is a gene therapy addressing mutations in the otoferlin gene, where alterations are associated with inherited deafness. An early- and mid-stage clinical trial of DB-OTO is set to begin, enrolling 22 children, including infants, in the U.S., Spain, and the U.K. with profound hearing loss and otoferlin gene mutations. The study aims to determine safety and dosage levels of the treatments, but the team is also tracking changes in hearing thresholds and auditory brainstem responses in participants.

Regeneron Pharma and Decibel Therapeutics are hardly strangers. Regeneron and Decibel are collaborating on development of DB-OTO and two other gene therapies for inherited hearing loss, a relationship begun in 2017 and renewed in 2021. “DB-OTO, our shared lead investigational gene therapy,” says Regeneron president and chief scientist George Yancopoulos in a statement, “will soon reach patients in its first clinical trial, offering new promise to children with this rare form of congenital hearing loss, as well as potential proof-of-concept for future gene therapies addressing more common forms of genetic hearing loss.”

Regeneron is acquiring Decibel Therapeutics by purchasing current Decibel shares for $109 million or $4.00 a share. Further payments to shareholders are contingent on Decibel achieving specified product development milestones, such as progress on DB-OTO clinical trials, and acceptance of biologics license applications or the equivalent in the U.S. and Europe. Achievement of the milestones are expected to add equity value of $104 million to shareholders.

“We at Decibel are deeply committed to discovering and advancing innovative new therapies with the potential to be transformative for people with severe forms of hearing loss,” notes Laurence Reid, Decibel Therapeutics CEO, who adds that “this transaction is the best way to maximize shareholder value and ultimately benefit patients.”

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