Endogenex raises US$50m for diabetes procedure

Endogenex has raised US$50m to complete development of its diabetes procedure and take the technology to the FDA.

The fundraising comes shortly after the company delivered initial clinical study results showing its pulsed electric field system met safety goals and led to metabolic improvements in HbA1c, fasting glucose levels and body weight.

Founded in partnership with the Mayo Clinic, Endogenex has been targeting the duodenum, the upper section of the small intestine, with a treatment that aims to reset inflamed and dysfunctional tissue linked to type 2 diabetes and the gut’s ability to regulate blood sugar, appetite and digestion.

Its procedure delivers pulsed electric fields to the inner mucosal layers of the organ through an endoscopic electrode array, eliminating poorly functioning cells and stimulating regeneration without potentially damaging heat. The approach previously obtained breakthrough designation from the FDA.

Endogenex chief executive Stacey Pugh said: “This financing puts us in a strong position to complete our pivotal study and take the ReCET System through FDA approval.

“Type 2 diabetes continues to take a heavy toll on patients, providers, and the healthcare system. Even with the best available therapies, including GLP-1 receptor agonists and SGLT2 inhibitors, the disease often continues to progress.

“We believe that is because an important part of the disease has gone untreated: the gut. By restoring the duodenum to a healthier state, we aim to help patients do more than manage their symptoms.

“We want to potentially alter their disease progression, and this funding moves us meaningfully closer to that goal.”

Earlier this month, the Minneapolis-based company announced the publication of 48-week results from proof-of-concept programmes in the US and Australia.

More than 70 participants with poorly controlled type 2 diabetes underwent the procedure, with a 100 per cent technical success rate.

One group of 31 patients who received a double application from a second-generation, higher-energy device saw an average HbA1c reduction of 1.5 percentage points over 48 weeks, as well as weight losses of about 5.4kg, amounting to about five to six per cent of their body mass.

At the same time, glucose monitoring data showed their time in a healthy range increased from 55.8 per cent to 82.1 per cent. The trial results were published in Diabetes, Obesity and Metabolism.

The US$50m will help fund Endogenex’s pivotal trial, ReCET, which is now enrolling patients.

The proceeds, led by new backer Arboretum Ventures, come as part of an extension to a 2024 series C round that had raised US$88m.

A separate company also chasing ways to reline the duodenum, Fractyl Health, previously showed its thermal Revita rejuvenation procedure could deliver durable HbA1c benefits out to two years.

However, Fractyl later pivoted away from pursuing a type 2 diabetes indication and, following redundancies, instead directed its research towards obesity and a procedure for maintaining weight loss in people taking GLP-1 drugs.