UChicago startup, on cusp of developing a drug to prevent kidney stones

A University of Chicago biotech startup was awarded a $2.3 million grant that would speed up the development of a first-of-its-kind drug to prevent kidney stones.

The grant, from the National Institutes of Health (NIH), was given to Oxalo Therapeutics, founded in February by Dr. Hatim Hassan and Yang Zheng.

Hassan, an assistant professor of medicine at the University of Chicago and Zheng, a student at the university’s Booth School of Business, named the company after Oxalobacter formigenes, a gut bacteria that reduces the incidence of kidney stones.

While not yet profitable, Oxalo employs a handful of part-time research scientists who are tackling severe kidney diseases using cutting-edge therapies.

Replacing liver transplants with a daily pill

More precisely, Hassan’s team has been working on developing an oral pill that can safely remove oxalate from the body, a toxin that, in combination with calcium, causes 80% of kidney stones.

With kidney stones on the rise as a result of fast food diets and sedentary lifestyles, this research is extremely valuable. About 1 in 10 people will have a kidney stone at some point in their lives, according to the National Kidney Foundation.

Oxalo also aims to treat more severe kidney diseases such as primary hyperoxaluria, a rare condition characterized by recurrent kidney and bladder stones that mostly affects children. There are currently no effective therapies for primary hyperoxaluria, except liver transplants or a liver-kidney double transplants.

Oxalo will receive the $2.3 million grant in two installments — one this month and one in September 2019 — through the National Institutes of Health’s Small Business Technology Transfer (STTR) program. STTR is one of the largest sources of seed capital in the United States for health-tech startups.

“For us, it’s all about progressing the science as quickly as possible,” said Zheng. “Our job is to remain well-capitalized so we can progress through these (de-risking) studies and … generate more investments.”

Chicago, a tech entrepreneur’s haven

The quest for funding led the company to enroll in another prestigious competition.

This time they’re going after $1.5 million in shares of  equity-free prizes of the MassChallenge, a startup accelerator in Boston. Oxalo is up against 25 small tech businesses, after beating fierce competition from more than 1,600 applications from around the world. Through the program, Oxalo gained access to expert mentors, tailored programming and connections with top corporate partners.

The company attributes its success to Chicago’s thriving entrepreneurial tech scene.

“The resources here helped us get to this stage”, said Zheng. “They recognize that there is good technology here, the strong research institutes are drivers [of that].”

The state of Illinois is indeed rapidly becoming the Midwest’s next science hotspot. Universities are attracting massive funding and achieving medical breakthroughs at a record pace. The most recent example is a $660,000 grant received by Illinois State University (ISU) from The National Science Foundation (NSF) to build a state-of-the-art microscopy laboratory. The facility will help scientists make great leaps in the fields of genetics, cell biology, development, neuroscience, and plant science. Most importantly, these discoveries will one day become drugs and medical devices that will cure highly complex diseases from cancer to infertility to diabetes. As Zheng explained, that is exactly Oxalo’s end goal: to either team up with or sell their drug to a large pharmaceutical company that would take it to market.

This is a widespread strategy among researchers and tech-savvy health entrepreneurs working on novel drugs.

Academia often shakes hands with big pharma players for the greater good of patients –  and to suit their agenda. Few university patents turn into marketed products.  In exchange for exclusive licensing rights, pharma money and connections can convert university research into drugs on pharmacies’ shelves.

In fact, two years ago, University of Chicago partnered with Takeda, Japan’s largest pharmaceutical company, with a focus on treatments for inflammatory bowel disease (IBD). With such role models right in their backyard, Oxalo has a real shot at getting their drug into the hands of millions of patients with kidney issues.