Munich’s Innovative Molecules signs €125M partnership with Alfasigma to advance HSV encephalitis antiviral

Never heard much about Innovative Molecules? That may be about to change. The Munich-based biotech Innovative Molecules is stepping onto the larger pharma stage. The clinical-stage company has struck a strategic partnership with Italy’s Alfasigma that brings both fresh capital and a global licensing deal for one of its lead antiviral assets.

Under the agreement, Alfasigma will invest in Innovative Molecules and secure exclusive worldwide rights to the parenteral formulation of adibelivir, a next-generation helicase-primase inhibitor, for the treatment of HSV encephalitis, an ultra-rare but life-threatening neurological infection for which therapeutic progress has been limited for decades. Financial terms include upfront and milestone payments that can total up to €125 million, linked to development, regulatory and commercial milestones.

While HSV encephalitis affects only an estimated one in 250,000 to 500,000 people, its impact is severe, with high mortality and a significant risk of lasting neurological damage among survivors. Current antiviral treatments have done little to improve outcomes, leaving a clear unmet medical need. Adibelivir is being developed as a long-acting inhibitor with the potential to achieve better viral control and, ultimately, improve survival and long-term neurological outcomes.

The deal neatly splits development paths. Alfasigma takes responsibility for developing, manufacturing and commercialising the injectable formulation specifically for HSV encephalitis, aligning with its focus on specialty and rare diseases. Innovative Molecules, meanwhile, retains full rights to all other formulations, including the oral version of adibelivir, which is advancing towards Phase II trials in genital herpes.

For Alfasigma, the partnership fits its strategy of expanding its pipeline with differentiated assets in areas of high unmet need. For Innovative Molecules, it is a clear external validation of its science and a financial boost that should accelerate clinical progress of its broader HSV programme.

Experienced team in antivirals

The key to this deal, just two years after the start of the clinical trial, comes down to the Innovative Molecules team. The company was founded in 2016, but it was not until 2021 that it received €20 million in financing to begin working on the molecules. The leading management has its experience from the company Phenex and Myr, both successful German companies known for their exits to pharma.

Florian Vogel is the CEO and was the former Managing Director at MYR GmbH (now part of Gilead Sciences). He successfully managed a range of product launches of biotech and pharma products. Thomas Hoffmann, CFO of Innovative Molecules, was founder and former CFO at Phenex Pharmaceuticals with a track record in transactions including major licensing & assets deals and a co-managed dual IPO on the NASDAQ & Frankfurt Stock exchange. Dr. Alexander Alexandrov, M.D. is the acting CMO of the company, which is formally located in Munich close to a well-known tax consultancy. He was the founder and former Chief Medical Officer at MYR GmbH and a key driver of development for HepD drug Hepcludex. The innovative molecules come from the lab of Prof. Dr. Gerald Kleymann, PhD, who acts as CSO and co-founder at Innovative Molecules. He discovered multiple antivirals, including letermovir, pritelivir and IM-250.

With one product moving into human trials and a heavyweight pharma partner now on board, Innovative Molecules is unlikely to remain under the radar for much longer.