Transcera: Hunter Goble, CEO
“For us, storytelling has been critical.”
“Delivery is everything!” cried my middle school drama teacher, now visibly upset. I was summarily dropped from our 8th grade production of the Iliad. He was right, of course, and it’s an adage that holds true for thespians and drug developers, alike.
Science has generated powerful peptide, antibody, oligonucleotide and CRISPR-based weapons with which to combat disease. What’s missing is an effective Trojan Horse to steal these therapeutics across the walls surrounding the gut, brain and other tissues. Pathogens have figured it out—often finding creative ways to invade the gut mucosa or cross the blood-brain-barrier to cause disease.
As clinicians and scientists, we have been less successful in breaching these natural “walls” for drug delivery—often resorting to injecting biologics to bypass the gut: “Most biologic medicines can't get absorbed through the GI tract, because they're blocked by an epithelial cell layer,” explains Hunter Goble, CEO of Transcera. When delivering multiple doses of a biologic to patients at home (or in developing countries), the ability to take a medication by mouth is paramount: “our mission at Transcera is to fully unlock the potential of biologic medicines.”
But how to shuttle drugs across the gut epithelium? Many have tried and failed to breach these formidable walls—it took the Greeks ten years to conquer Troy, and drug developers have been at it for longer than that. Brute force has not done the trick: “Others have used chemical ‘permeation enhancers’ to facilitate passive diffusion of drug molecule across the epithelial barrier…these are ineffective and disrupt the gut in an unnatural way,” says Goble. “The pathway that we're capturing is active and endogenous—transcytosis.”
Built on 30 years of basic science from Wayne Lencer’s lab at Harvard, Transcera has developed a sphingolipid-based platform to enable oral biologic delivery. By conjugating these proprietary ceramides to a molecular cargo, they can “trick” the cell and co-opt the endogenous process of “transcytosis” for transport across the gut epithelium. It is a strategy used by cholera toxin and polyomavirus—now repurposed for therapeutics. “Wayne [Lencer] likes to say that nature discovered this system,” says Goble. Odysseus would certainly admire the ingenuity.
Goble and his team have winnowed down a universe of potential indications to focus on rare endocrine and metabolic disorders, including short bowel syndrome (Q#6). They have demonstrated the ability to deliver peptide analogs in rodent models, and discovered that ceramide-conjugation increases biologic half-life: “we can make oral drugs, but we can also make better oral drugs” (Q#7). Founded in 2020 by Goble (CEO), Wayne Lencer (academic co-founder) and Justin Wolfe (CSO), Transcera raised $1 million in pre-seed funding from Pear VC, KdT Ventures, and Digitalis. The team also won the 2021 Harvard President’s Innovation Challenge, two Golden Tickets, and recently received a fundable SBIR grant score (Q#12). Based out of LabCentral, Transcera is currently raising seed funding to continue developing their platform and start advancing lead assets.
Hunter Goble (CEO) has taken an unconventional route to early-stage biotech, though (verbal) delivery has always been one of his strengths: “I thought I was going to be a lawyer or politician when I was in high school…I loved debate, which I viewed as my sport.” After deciding that a career in business was a better fit, Goble interned at Eli Lilly and Company during college, and accepted a position with their marketing team after graduation: “I got exposure to a wide spectrum of the pharmaceutical product lifecycle—basically everything from assets that were in phase two clinical development, to product launches to some legacy brand work.” After five years of this “head dunking” in big pharma (Q#2), Goble yearned to work with earlier stage and highly innovative companies in the Boston ecosystem. An acceptance to Harvard Business School gave him entre to the labs at Harvard and MIT and led him to enroll in the Nucleate program. A two minute “speed-date” with renowned physician-scientist, Wayne Lencer, sold Goble on the promise of the underlying technology. Over the course of the next few months Transcera was born.
At its core, drug development is a battle: promising campaigns have unexpected Achilles heels, seemingly insurmountable obstacles eventually crumble, and innovation can be, quite literally, lifesaving. Transcera has realized that a novel stratagem is required to claim victory against some of the most debilitating conditions. They are building a biologic Trojan Horse—one that has the potential to shepherd armies of medicines across our body’s barriers. In doing so, Goble and his team hope to give patients a leg up in the struggle against disease.
Below is an interview with Hunter Goble, CEO of Transcera from January 2023:
1. What first made you interested in science & medicine? Was there a mentor or teacher that set you down this path?
I always thought I was going to be a lawyer or politician. In high school, I was heavily involved in Speech & Debate. I wasn't great at sports but I loved debate, which I viewed as my “sport.” My debate friends and I often talked about becoming lobbyists one day, which is a funny thing for a high school student to aspire to, in retrospect. I decided to attend a small liberal arts college in Indiana called DePauw University, where I figured I would be well prepared for law school and a career in politics. My freshman year, I interned on Capitol Hill for long-time Indiana senator Richard Lugar, and while the experience was amazing, I realized that going directly into a career in government can make for a long slog to accumulate any influence or have any meaningful impact. I began to think that I could learn more hard skills and have an earlier impact in a business career without closing the door to political aspirations. So I started interning at different companies, and one of them was Eli Lilly in my hometown of Indianapolis.
For the spring semester of my Junior year at DePauw, I worked full-time in Lilly's Managed Healthcare Services group, which was the business unit that negotiated and administered reimbursement contracts with payers. It was run by Alex Azar, who later become President Trump’s HHS Secretary. The experience was super appealing to me; I got what felt like a behind-the-scenes view into this complex, not well understood industry that’s full of opportunity for improvement and tangible impact, and one heavily influenced by politics too.
That was my first exposure to life sciences, but I think I was primed from an early age to develop a deep appreciation for science and medicine. I lost my father to a heart attack when I was six years old. It was his second heart attack, and he was only 39, so there was definitely some underlying heart disease. And other chronic inflammatory conditions including diabetes and Alzheimer’s Disease have heavily impacted my family. I think as a result, I found it easy to empathize with patients while working at Lilly, and I developed a deep passion for the pharmaceutical industry.
2. After undergrad, you spent about 5 years with Eli Lilly. What sort of work were you doing there?
I was in the marketing organization at Lilly, which at that company is the core “business” function. I got a breadth of experience—working in a US product brand team, a global product brand team, and in different business units. I spent a little bit of time in oncology and a lot of time in “biomedicines,” which encompassed smaller programs in neuroscience, autoimmune disease and other areas. The nice thing about starting that way is I got exposure to a wide spectrum of the pharmaceutical product lifecycle—basically everything from assets that were in phase two clinical development, to product launches, and even some legacy brand work. I learned about new product planning, pricing, reimbursement, access, consumer advertising and physician marketing. It really was a “head dunking” in the pharmaceutical industry as a whole.
Specifically, I got to work on the US launch team for ixekizumab (Taltz), which was approved in 2016 for psoriasis. Leading up to approval, Lilly was building a new sales force to call on dermatologists. The newly hired sales representatives were required to take an online course in immunology, the pathophysiology of psoriasis, and the mechanism of action for ixekizumab. They decided if the sales force had to do it, the marketers did too. I was a year into a career as a pharmaceutical marketer with a political science degree, reading and taking tests on macrophages and cytokines and the inflammatory cascade. The more I understood, the more I could engage cross-functionally with the doctors and researchers on the clinical development side. And it made me a better marketer too. The brand leader was a commercial guy named Phil Schallwig. The US Taltz team was like a mini company within Lilly, and Phil was Taltz’ CEO. So, I guess I have him to thank for the immunology lessons.
[What were the key takeaways?]
I think over the course of my five years there, I learned about how a drug gets from inception to patients. I learned that it often isn't the big pharma companies that do the most “innovating.” Lilly is a phenomenal clinical development and commercialization engine, they really know how to take a drug from a phase one clinical trial and get it to the market and patients. But they're not actually doing a ton of innovating, on the basic science side. It took me a while to realize few of the drug products we were working on came directly from Lilly’s own research labs—most came to the company through business development. That trend holds true across the industry, I think. I started to wonder about the sources of actual innovation in the life sciences industry, and that was part of my motivation for wanting to go to school in Boston. I wanted to access and learn more about the life sciences ecosystem here.
Pursuing an MBA was also an opportunity to broaden my horizons. At that point in my life, I had never lived outside the Midwest, and with the exception of a couple internships, I had never worked anywhere but Lilly. I wanted to know what else was out there, and I wanted to be challenged. I thought the best way to do that was to go to HBS [Harvard Business School].
3. As an MBA student at HBS did you have any specific classes or mentors that helped solidify your desire to go into the life sciences/biotech? What motivated you apply to Nucleate—was starting the company always the plan?
I was pretty certain I was going to stay in the life sciences industry. The plan was to come to school, and then to go back to Lilly afterwards. I always knew there was a possibility that I wouldn't go back. But I wasn't sure what that would look like. I did not come to HBS intending to found a company and be an entrepreneur. I was definitely exploring my opportunities within the life sciences. I was really interested in business development, but ended up actually deciding to do a life sciences consulting internship. I went to work at Huron’s life sciences practice, based in New York. I thought that it would be a good way to continue to scan the life sciences industry for different opportunities, and develop some analytical muscles [with respect to looking at life science companies].
When I came to HBS, I was very actively looking for opportunities to learn about the biotech industry and the academic institutions that are producing a lot of innovation. I happened to see a call out in the Harvard Biotech Club’s weekly newsletter for this program called “Nucleate.” They were pitching a biotech entrepreneurship program, where you would learn about biotech company formation. I thought that sounded super interesting, and I would learn a lot. I applied, and they admitted 10 or 15 business school students and the same number of scientists from Harvard and MIT. The idea was to form collaborations between students at those two institution and different graduate schools.
At HBS, Laura Huang's Founder's Journey class helped me gain the confidence that I could do it, and start a company. Two of Jim Matheson's classes - Tough Tech Ventures and Entrepreneurial Finance - gave me some practical tools when I went on to co-found and lead Transcera.
4. What were the strengths of the Nucleate program when you participated? In addition to meeting your co-founders, what were the most helpful aspects and lessons learned from the program?
I think the strength of Nucleate is exposure to lots of great science happening in academia. There has always been an immense amount of really impactful research happening in academic institutions across the country, but not enough translational machinery or infrastructure to get that out of the academic setting and into clinical development. That was the premise that the Nucleate founders started with—they wanted to see if they could fill that gap. There was a lot of pent-up demand, which I think is why the program has had so much success. They have now expanded across the country, and even internationally.
I came in as a business school student, with a big pharma marketing background, just trying to learn about biotech. Right off the bat, I was introduced to 15 or so PhD students and postdocs who were working on all these cool projects with commercial potential. I feel very fortunate to have been able to participate, and in hindsight it changed my life. I went from planning to return to Lilly and work my way up the corporate ladder to leaving Lilly and taking on all the risks involved with starting a company. What I would say to people who are getting involved in Nucleate or programs like it—one of the most valuable things we got out of the experience was being forced to articulate a clear and compelling story around a novel technology with a lot of different use cases. I think that was really hard. Early on, we weren't very good at it and were a bit unfocused. As a result, our story didn't resonate with people like it does today. Telling a succinct, clear and compelling story about a complex technology is crucial.
[How did you refine Transcera’s story?]
There was a lot of mentorship, both formal and informal, through the [Nucleate] program. We also got exposure to investors and lawyers who work with startup companies in the biotech industry. Then there was an actual pitch competition, as the culmination of the program. Beyond the program, we continued to seek out opportunities to get feedback. We applied for things like the Harvard President's Innovation Challenge, which we ended up winning. We applied for the Harvard New Venture competition, which we ended up winning, and we also participated in the Harvard iLab Venture Program and Mass Challenge Accelerator. I think the most impactful part was the opportunity to practice telling our story in different ways and getting feedback in a relatively risk-free forum. At this point, we thrive on feedback. I don't think you can be successful without it.
5. What is the founding story of Transcera—what inspired you to do this with Wayne Lencer? What was the company’s initial vision and has this changed over the past year?
The first part of Nucleate was a speed dating night, where they had 10 to 15 business school students, and the same number of scientists. You had two minutes with each scientist to introduce yourself and learn about their project. Almost all of the scientists in the room were PhD students or postdocs, but there was this one older guy with long gray hair held back in a headband. He was wearing a scarf and had this incredible “hippie doctor” energy. When we met for our two minute “date” I introduced myself and told him about my background at Eli Lilly. He perked up and said that he had previously had conversations with Lilly and found my experience interesting. He introduced himself as Wayne Lencer, and told me about what he was working on: his lab had this technology that could enable the oral delivery of traditionally injectable biologic drugs. He had been working with the therapeutic peptide GLP1, as a demonstration project. I had just come from Lilly, of course, where Lilly's highest grossing product was Trulicity—a GLP1 peptide administered by weekly subcutaneous injection. I immediately recognized the groundbreaking potential of a solution like the one Wayne was describing. Wayne liked the fact that I had industry experience at Lilly, and he knew that big pharma would be potential customers for a technology like this, and my experience would prove useful in the long-term. We teamed up, and we went through the program together—just as peers exploring whether or not there was an opportunity for a company to be formed. Over time, we realized that there was a huge opportunity, and that I would lead the company as CEO.
[What got you to the point where you were ready to commit full-time and leave Lilly, and the funding they provided for your MBA?]
I think there were different points where the level of commitment stepped up, incrementally and over time. I went through my own process of de- risking the career path over the course of my entire MBA experience. Wayne and I met in the winter of my first year of business school. We incorporated the company the next fall, in August 2020. I had actually taken a semester deferral from HBS because of the pandemic. I was back at Lilly, working at my old role. At this point, Transcera was still a side project. I left Lilly again at the end of 2020 to return to HBS. We spent all of 2021 building the foundations for the company, which meant finding a CSO--because Wayne never intended to leave his academic posts at Harvard. We also needed to raise money and find space. I spent all of 2021 finishing my degree, and doing that on the side. We ended up raising a pre-seed round of venture capital funding in the summer of 2021. As soon as the money hit the bank, I called my mentors at Lilly and told them I wasn't coming back. That was the point of no return.
[How did your mentors at Lilly take the news?]
They were extremely supportive. I am incredibly grateful to them for that. Laurie Kowalevsky, the VP at Lilly who formally sponsored me to pursue an MBA, was very kind and understanding. She said: “If you were going to Abbvie, we'd be having a different conversation. But I understand this is a once in a lifetime opportunity to do something risky, but impactful.”
6. What can you tell us about the company’s lead indication/program? What gets you excited in terms of the market and potential patient impact? How did your past experience at Lily inform this view?
Our vision has not changed since the day Wayne and I met [at Nucleate]: we are developing a delivery platform to enable oral administration and amplified biodistribution of biologic medicines. The mission hasn't changed, but we've sharpened our therapeutic focus, refined our development strategy, and improved our messaging.
For background—the fundamental problem that we're working on solving is enabling the oral delivery of biologics. Most biologic medicines can't get absorbed in the gastrointestinal tract, because they're blocked by an epithelial cell layer, which lines all our mucosal surfaces. Our technology is a delivery platform that is based on the biology and membrane trafficking of sphingolipids. We can hitch-hike on the process of transcytosis by using a proprietary ceramide lipid as a carrier, and that’s where our name comes from: harnessing transcytosis using ceramides - Transcera. By conjugating cargoes to our carrier, it enables us to get large molecules across that epithelial cell barrier in the intestine. This is obviously a platform technology that we could use for a number of different indications.
We spent all of 2022 basically developing the platform and enabling the synthesis of our vehicle drug conjugates at scale. We still have some platform development to do, but we have turned our focus towards therapeutic product development. We have recently evaluated the potential indications, which is a huge space. We are starting to narrow our focus to peptide hormone analogs for rare endocrine and metabolic diseases. There are a few reasons for this choice, including market opportunity and unmet need. The standard of care for a lot of endocrine and metabolic disorders is to administer replacement peptide hormone analogs via daily injection—think of growth hormone or parathyroid hormone. We're going through a process now of target selection on those types of endocrine opportunities. We are excited about GLP2 for the treatment of a disease called short bowel syndrome. This is a rare disease affecting somewhere between 10-30,000 people in the US who have had surgical resection of part of the intestine to treat disorders like Crohn's disease. These patients are often put on chronic parenteral nutrition. There's only one drug on the market for this disease today, which is a drug called GATTEX from Takeda—it is a daily injection of this GLP2 analog. We envision using our delivery platform to create an oral version of GLP2 for patients suffering from short bowel syndrome. Our technology harnesses the membrane trafficking of sphingolipids to get biologics across the epithelium by transcytosis.
7. What do you view as the “secret sauce?” Many companies have tried to use lipids for oral delivery—what will be the difference maker with Transcera?
I think the key difference is that we are using an active biological pathway to induce uptake. Others are using chemical permeation enhancers to facilitate passive diffusion of drug molecule across the epithelial barrier. These other carriers disrupt the gut barrier in an unnatural way. The pathway that we're capturing is an endogenous one. It's actually the same pathway that microbes like cholera and polyomavirus use to gain entry into host cells and cause disease. Wayne [Lencer] likes to say that nature discovered this system, not him. Our platform is directly based on the Lencer lab’s discoveries about how cholera toxin gains entry to cells within the GI tract. We are exploiting the same basic biology, but for the delivery of therapeutic macromolecules. There are a number of advantages to our approach: I think the most important one is that we have the only system that I'm aware of that both enables oral absorption of macromolecules and improves their circulating half-life (and their biodistribution). Our conjugates, which we've been testing in rodent models, have dramatically improved half-life in vivo, which you don't get with permeation enhancers. This means we can make oral drugs, but we can also make better oral drugs. I think that's the secret sauce. Another critical advantage that's related is that Wayne and his group at Boston Children's Hospital had been studying this pathway for 30 years. We have a very deep understanding of the mechanism and the fundamental cell biology involved.
8. Given Transcera’s current stage and size, what are you working hardest on as CEO?
It's always everything, that’s the job. But my primary focus right now is fundraising so that we can continue to develop the platform, test it in larger animal models, and advance into therapeutic product development, all of which we plan to do this year. We only raised a million dollars in our pre-seed financing. With that amount of funding, we've already developed the chemistries to enable “plug and play” attachment of our vehicles to virtually any therapeutic cargo at scale. And we demonstrated oral bioavailability and improved half-life of a peptide in vivo using our fully synthetic platform. We are proud of what we've accomplished with a small team and very limited resources. We've been super capital efficient. Our home base is in Lab Central, in Kendall Square. Now I want to add some jet fuel to Transcera’s engine. We are very actively fundraising.
9. In today’s climate what has it been like trying to raise capital as a young founder? What is one short piece of advice you would give to prospective biotech entrepreneurs, perhaps going through Nucleate?
There's a lot of cynicism and hand wringing in the market right now. But I've been really encouraged by the interest and traction that we've had with investors as we've started to share our data. I remain very optimistic. I think that a lot of funds raised capital in the last year, or year and a half. They have money that they need to deploy. I don't know what the latest data is, but there are definitely deals being done, and I think good science will continue to get funded.
My advice is that if you have exciting science, and you have a strong team in place, don't be shy: go out there and raise money so that you can continue to develop your company. For us, storytelling has been critical. I think it's even more important right now, when folks might be more cautious, holding on to their checkbooks more tightly. Maybe that is biased advice coming from a marketer. I think being able to tell a compelling story succinctly is one of the best skills that an early-stage startup founder can have. I think that's played a role in whatever traction we've been able to generate so far, both in our previous round and current one.
10. What are some common traits of great investors with which you have interacted?
The best investors know a lot about a lot. They're aware of emerging technologies and how they work. They are up to speed on the latest groundbreaking developments in major therapeutic areas. They know the markets and have a finger on the pulse of both public and private companies. I think they read constantly and love seeking expert opinions on industry news and trends. Mark Springel at Vida Ventures is a great example of this, as well as our current investors at Pear, KdT and Digitalis.
My second answer to your question about what makes a good investor, is that great VCs create an environment of trust with their founders and portfolio companies. They make it feel like their founders have a risk-free sounding board. When you are an early-stage founder, particularly if you are a first or even second-time founder, there will be a lot of things that you haven't seen before. I am looking for someone I can go to, and ask questions that might be considered naive, without fear of judgment. Someone who knows that I'm a smart, capable person, and will help me figure things out, and build the company—someone who will roll up their sleeves and work through challenges with me. I think that's easier said than done. A lot of VCs talk about that, but I think creating that environment and building trust is really hard.
11. What is another biotech that you think serves as a paragon of an impactful company? What are the key learnings from this case study?
Vertex is one—it’s a company that I admire because it’s one of the few pharma companies that “walks the walk” when it comes to their R&D investment and innovation. I think Vertex invests around 80% of their revenues back into R&D. The industry standard is more like 20 to 40%, so to me that's walking the walk. They also famously pioneered rational drug design and discovery. There is a lot to admire there.
Thinking about smaller companies, one that comes to mind is Vaxess technologies, which is developing a vaccine patch. They have a flu vaccine patch in phase one clinical trials and recently had a positive data readout, which was exciting. And I just admire what they're doing and the potential impact that it could have. If you think about the delivery chain for vaccines—if you could give someone a heat-stable patch to administer at home, it could improve access to developing countries. I think it is a really disruptive technology. I also really like the founding team and their story—it doesn’t hurt that the founding CEO is a normal guy from Indiana like me. Denali therapeutics is another company [much larger] that has a great founding team and is really mission driven—a clinical stage company that's hyper focused and impactful.
12. Any other announcements you want to share about the company? E.g. recent hires, publications, funding or open job positions?
There was a paper out of Wayne's lab that was published this past summer, which elucidates the structure function relationship between different ceramides and intracellular sorting pathways. The publication emphasizes the depth with which we understand the cell biology and the mechanism of our platform. The lead author— Sfefanie Schmieder—is a great cell biologist and a friend of the company.
Regarding Transcera, we are off to a hot start this year. We learned recently that we received a very fundable score on our SBIR grant and we're expecting to get funded in a couple of months. We were awarded another Golden Ticket from Biogen, and we've just kicked off our seed fundraising round. We are actively seeking investors who understand the potential of the ceramide conjugation technology and want to join in on our mission to unlock the potential of biologic medicines.