Transformative Growth

Migraine is one of the most prevalent conditions in the world. Historically, therapy relied on NSAIDs and/or OTC medicines, until the emergence of novel monoclonal antibodies, starting with CGRP-inhibitors in 2018. CGRP-inhibitors demonstrated superiority over historical drugs in acute treatment and prevention of migraine.

In 2020, New Rhein began to research non-pharmacological approaches to migraine treatment, specifically neuromodulation devices with comparable efficacy to the emerging pharma treatments (CGRP-inhibitors). We reviewed five companies, and were most impressed by Theranica, a neuromodulation device with comparable efficacy to CGRP-inhibitors, that had an arm-band approach to neuromodulation (vs. forehead placement). Theranica’s device was initially approved for acute treatment of migraine.

The company was raising a Series C financing to drive commercial growth and label expansion. New Rhein invested in 2022 in a down-market at a down-valuation and instituted a plan to launch the device based on its clinical efficacy data, patient convenience/drug-free and digital advantages. Our investment has since funded the hiring of a new US President & CEO, a Chief Medical Officer, a Head of Medical Affairs, and a Head of Marketing.

With New Rhein’s guidance, the company grew its commercial organization. Since investment, revenues have grown 14x, we have positive reimbursement decisions from US insurance companies, and we have setup international distribution partnerships to commercialize the device in India, Germany, UK, Spain, Japan, and other countries.

Chase Pharmaceuticals developed a 505(b)(2) application to combine two leading drugs used in the treatment of Alzheimer’s Disease. Alzheimer’s affects over five million Americans and is increasing as our population ages. Current standards of care rely on the cholinesterase inhibitor class with or without memantine. Donepezil leads the market with one million Americans taking the drug daily. While efficacy generally improves with higher doses of the drug, this also increases side effects for patients. Chase Pharma’s combinative platform proposed to increase efficacy while reducing side effects.

In 2014, New Rhein partnered with Cipla and Andera Partners to invest $20 million in Chase Pharmaceuticals for a 60% equity stake in the company. New Rhein secured the role of Chairman of the Board. The New Rhein/Cipla/Andera consortium also negotiated the rights to appoint two additional directors, as well as to appoint and remove the CEO, to nominate an independent director, and to bring along other investors in the event of a sale. Chase Pharmaceuticals was sold to Allergan for a total deal value of up to $1 billion in a structured transaction: a $125 million upfront payment in 2016, plus a $75 million milestone payment in 2018.

Softhale develops drugs for COPD and Asthma, delivered via a proprietary softmist inhaler. COPD affects over 390 million people worldwide, is the fifth cause of death in the US and the third cause of death in China. COPD is the most prevalent cause of death for cigarette smokers (above lung cancer). Softhale has a robust pipeline of products for COPD / Asthma including 505(j) versions of two Respimat products, Spiriva and Stiolto and a novel triple drug combination (Lama/Laba/Steroid).

New Rhein recruited the independent Chairman of the board (ex-Cipla) and CEO (ex-Novartis), led every financing round in Softhale and actively supported the strategic, operational and corporate development activities. New Rhein Fund I invested an aggregate of $5.2 million into the company for a 25% stake at exit. New Rhein Fund I invested a further $13.4 million for an additional 40% stake at exit (New Rhein funds owning 65% of the company at exit). In 2021 New Rhein helped the company run a sale process that led to the sale of Softhale to SinoBiophama for $110 million plus milestones potentially worth over $100 million.