Staying Passionate about IO’s Potential and Investing in Biotechs Addressing IO’s Toughest Challenges
Rakhshita Dhar, Senior Director, Venture Investments, Health, Leaps by Bayer, discusses how she’s helping to generate impact in the IO landscape through her investment, gives her thoughts on capital raising in 2025 and what keeps her optimistic about immuno-oncology.
What is the work you’re leading at Leaps?
My role as an investment director is to find investments that we’re excited about. We’re a mix of strategic and white space, so we’re similar to an impact investing fund with a strategic bend. The goal has always been to invest in opportunities that change the treatment paradigm and address broad, unmet medical needs.
I’m investing in novel medicines for the future. My portfolio is mostly IO, partly because oncology is a big area of investment in general and because there’s a lot of opportunity in oncology from scientific and investment perspectives. We’re also invested and expanding into other disease areas like autoimmunity, inflammation, neuro and genetic diseases, etc.
"We’ve seen immuno-oncology open the door for a lot of knowledge in immunology and autoimmunity, which we’ve been able to connect to other diseases."
What keeps you passionate about the IO space?
I truly believe in the science and there is a lot of room for novel medicines to evolve in this space. We know from experience that when it works, it works big. I know that some of the failures have given people pause, so I hope as an industry we can collectively come around and feel more comfortable. We have to brush ourselves off and continue working.
We’ve seen immuno-oncology open the door for a lot of knowledge in immunology and autoimmunity, which we’ve been able to connect to other diseases. Autoimmunity is a hot area of immunity with a lot of investment and developmental science behind it. Much of that came from work that’s gone into immuno-oncology. The success we’ve had with blockbuster drugs like Keytruda have generated immunology learnings. That has opened the door for more work in immunology but also our understanding that the underlying cause of many diseases can be immunology.
What impact do you see coming from some of the companies you’ve invested in?
I’ll point to two companies, which present very unique ways of addressing specific challenges in IO. We’ve had big success in IO in the form of PD-1/PD-L1, but many other drugs have failed to follow that promise. That is partially because of our limited understanding of the underlying biology and immunology.
One company, Deka Biosciences, is creating cytokine-based therapies. Over the years, many companies have tried to tackle the challenge of making IL-2 less toxic without sacrificing its cancer-killing potential. What intrigued me about Deka was the ability to combine multiple cytokines, which is a new way of thinking. In the body, cytokines act in concert with other cytokines. When you send in just one, like IL-2, it’s not being compensated by the other cytokines that are complementary to its nature. The theory is that combining IL-2 with the complementary IL-10, makes it safer. The impact of that could be a very potent, anti-cancer drug made very safe for patients.
Another company, NextPoint Therapeutics, is in the checkpoint inhibitor space, focusing on the B7-H7 pathway. Real-world data has shown that while there are patients who are PD-1-positive, for whom existing drugs work, there are equally patients who are B7-H7-positive, who don’t respond well to existing PD-1/PD-L1 therapy. In addition, the two pathways are independent of each other, so we could unlock a broad potential of checkpoint inhibitors.
How do you balance risk and potential when investing?
The challenge with IO therapies is that the models created in preclinical studies are very contrived, so the data may not reflect what the eventual information in the clinic might look like. That’s not unique to oncology or IO, but every investor has their threshold for investing.
For NextPoint, it was the real world data showing a presence of B7-H7-positive patients versus PD-1, and the differentiation of the pathways. That was helpful to me in understanding how distinct it was and its translatability.
For Deka, I had seen many previous attempts at making IL-2 less toxic, such as masking. Those can lower the therapeutic potential of IL-2, but Deka had non-human primate data that didn’t show a drop in therapeutic index while continuing to demonstrate safety. As always, proof lies in the clinic. So demonstrating safety and efficacy in patients is the ultimate goal.
"There is a general interest in going after things that come with de-risked biology, making something safer, or more effective, or more convenient. These are small incremental advances, but that is the mindset of a riskier environment."
What do you expect the 2025 IO biotech capital raising landscape to look like?
I think that the next few years will be similar to what we’ve gone through recently, in that we’re still in a very risk-averse market, from both an investment perspective and an M&A standpoint.
We have seen lower interest in things like IO until there is some clinical efficacy proof of concept, which most investors and strategics determine as being partial or complete response in patients.
There is a big interest in autoimmunity and inflammation. There is a general interest in going after things that come with de-risked biology, making something safer, or more effective, or more convenient. These are small incremental advances, but that is the mindset of a riskier environment. We’ve also seen high interest in ADCs, TCEs, radioligand therapies, etc.
To what do you attribute the greater interest in ADCs, TCEs and radioligand therapies?
ADC’s are an interesting story. This is another area that started out with a lot of interest, went through a long period where no one wanted to touch the space with a 10 foot pole and then clinical data demonstrated a meaningful impact on patients and disease burden eg. Drugs like Enhertu, Elahere and others. This opened the door to greater investment.
What mindset or advice has helped you the most during your career?
Try to learn as much as you can in each role. Oftentimes, we find ourselves focused on what the needs of our day-to-day jobs are. That is fine but you leave a lot on the table if you’re not learning from other people, not just about their jobs, but their mindsets, careers, emotional and personal growth, etc.
Those elements provide you with the grit you need to continue to learn and grow. I went into every job I’ve had wanting to do well, but also to learn a lot.
What advice would you give young people entering careers?
Don’t stress out. When I talk to young people, I can see the same look in every person. It can be daunting. You’re worried about going down the wrong path or getting pigeonholed into one particular type of career. You can create your own career, as long as you continue to learn from other people and build your network. No move you can make is wrong as long as you’re learning.
