Ventyx (VTYX, Financial) is a biotechnology company focused on treating auto-immune diseases by discovering and developing next-generation small molecule drugs for well-validated targets. Third Point first invested in Ventyx in 2016 as an investment in Opillan, which was developing an oral small molecule for ulcerative colitis as a Series B, with a post-money valuation of ~$20 million. The company’s objective throughout has been to create oral pills with the same efficacy as biologic drugs for significant auto-immune disorders.
In early 2021, Third Point, along with management, agreed to merge our Opillan investment into Ventyx to consolidate all auto-immune disorder assets run by the same management team under one company. We found the consolidated R&D pipeline, especially Ventyx’s Tyk2 inhibitor, commercially very attractive. Additionally, the merger allowed the company to bulk up its R&D pipeline and realize R&D synergy across several assets in discovery stages. The company went public in late 2021 and, in 2022, two events doubled Ventyx share price. First, Ventyx presented human data for their Tyk2 inhibitor, which demonstrated a superior potential drug profile versus Bristol Myer’s drug (deucravacitinib). Bristol Myer’s drug was approved last month by the FDA with a clean safety label as per the clinical trial results, which increases potential peak sales for this class of compounds across several auto-immune disorder indications.
Ventyx is a classic example of Third Point’s ability to be lifecycle investors throughout a company’s phases of development – from early stages to IPO and beyond. After returning multiples of our initial investment, we remain confident in the company’s future supported by the successful milestones they have reached indicating marketable products based on the strong emerging clinical data.
From Daniel Loeb (Trades, Portfolio)'s Third Point third-quarter 2022 letter.
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