NKGen Biotech CEO Paul Song, M.D., is putting his money where his mouth is, investing $2.65 million of his own cash to help accelerate the cash-strapped biotech’s phase 2 Alzheimer’s disease cell therapy trial.
California-based NKGen’s financial situation has been perilous even by the standards of today’s troubled biotech environment. The cell therapy developer ended September with just $8,000, having run up a deficit of $177 million to that point. NKGen delayed the filing of its annual report in March, telling authorities that it was unable to meet the deadline “without unreasonable effort or expense.”
Song has stepped in to steady the ship. The NKGen CEO made money in the sale of Fuse Biotherapeutics, another biotech he co-founded and led, and has funneled the proceeds into his current employer.
The $2.65 million from Song adds to $3 million in funding advances from AlpineBrook Capital. The advances are secured by personal guarantees from Song and James Graf, interim chief financial officer at NKGen. The biotech previously disclosed AlpineBrook convertible notes.
NKGen said Song has invested to try to accelerate its phase 2 trial, reduce its payables and cover the expenses it incurs as a public company. Ramping up the Alzheimer’s study and satisfying public company reporting requirements are critical to long-term success, NKGen said.
The biotech started a phase 1/2a study of its natural killer (NK) cell therapy SNK01 in people with moderate Alzheimer’s disease in 2023. SNK01, which NKGen has also studied in cancers, consists of a patient’s own NK cells. The cells are expanded and activated outside the body, without undergoing genetic changes, and readministered into the same patient.
Song is betting NK cells can boost outcomes in Alzheimer’s, potentially by reducing neuroinflammation. Few other investors hold out much hope that NKGen can validate the hypothesis. NKGen’s stock price has fallen precipitously since the company went public in a SPAC merger in 2023, culminating in Song making his investment while the price was 12 cents a share. The share price rose 33% to 18 cents on news of Song’s investment.