A Paragon Biosciences spinout just raised $290 million to go after migraine prevention with a totally different approach. The bet: current drugs leave half of patients undertreated, and a protein called PACAP could be the missing piece.
A Penny Stock Gets a $421 Million Makeover
InMed Pharmaceuticals was trading at roughly $0.65 a share. Its market cap was roughly $6 million. Its pipeline consisted of cannabinoid-based drug candidates for Alzheimer's and glaucoma that hadn't exactly set the world on fire.
Then Mentari Therapeutics showed up with $290 million and a plan to hijack the whole thing.
The Paragon Biosciences spinout announced a reverse merger with InMed this week, essentially using the struggling company's Nasdaq listing as a front door to public markets. When the dust settles, InMed's original shareholders will own about 1.5% of the combined company. Mentari's backers and new investors will control the other 98.5%. The implied market cap at closing: roughly $421 million.
If that sounds like someone buying a house just for the mailbox, you're not far off.
The Investor List Reads Like a Biotech All-Star Roster
The $290 million private placement wasn't just big; it was oversubscribed. Fairmount led the round, and the syndicate behind it is the kind of lineup that makes other biotechs jealous: a16z Bio + Health, Blackstone, Janus Henderson, Perceptive Advisors, RTW Investments, Venrock Healthcare, Wellington Management, and about a dozen more blue-chip names.
That kind of institutional backing for a company with zero clinical data tells you something important. These investors aren't betting on what Mentari has proven. They're betting on what existing migraine drugs have failed to do.
The CGRP Problem Nobody Talks About
You've probably seen the ads. Aimovig, Ajovy, Emgality, Vyepti: the CGRP-targeting antibodies that revolutionized migraine prevention starting around 2018. They work by blocking a protein called CGRP (calcitonin gene-related peptide) that plays a key role in triggering migraine attacks.
They were genuinely transformative. They also leave a lot of people hanging.
About 40 to 60% of patients on these drugs achieve at least a 50% reduction in monthly migraine days. That sounds decent until you flip it around: roughly half of patients don't hit that threshold. Even fewer get close to being migraine-free.
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For someone who gets 15 migraines a month, shaving off a couple of days is nice. It's not life-changing. The CGRP revolution opened the door, but it left a lot of patients standing in the hallway.
Enter PACAP: CGRP's Lesser-Known Cousin
This is where Mentari's science gets interesting. The company is built around a different protein called PACAP (pituitary adenylate cyclase-activating polypeptide). Think of it as a parallel highway to the same destination.
CGRP and PACAP both contribute to migraines, but they use different receptors and partly independent signaling pathways. Blocking one doesn't necessarily block the other. When researchers inject PACAP into migraine patients, about 50 to 60% of them develop a full-blown migraine attack, similar to what happens with CGRP infusions.
Here's the key insight: because PACAP runs on a parallel track, patients who don't respond to CGRP drugs might still respond to PACAP blockade. It's like discovering there's a second fuse box after you've already flipped every switch in the first one.
PACAP also does something CGRP doesn't. It's linked to those awful premonitory symptoms (the yawning, fatigue, and mood changes that warn you a migraine is coming). Blocking PACAP could theoretically address parts of the migraine experience that CGRP drugs simply miss.
Two Shots on Goal
Mentari isn't putting all its chips on one number. The company has two lead programs:
MT-001 is a monoclonal antibody that targets PACAP directly. It's the simpler play: block the new target, see if patients improve. The company plans to file for its first human study around mid-2026, with proof-of-concept data expected by 2028.
MT-002 is the more ambitious swing. It's a bispecific antibody, a single molecule engineered to block both CGRP and PACAP simultaneously. If CGRP drugs are like closing one valve and PACAP drugs close a second one, MT-002 tries to close both with a single wrench. The first human study filing is targeted for Q1 2027.
The bispecific approach is particularly clever because it could offer patients the benefit of dual-pathway blockade without the hassle (and cost) of taking two separate drugs. One subcutaneous injection. Two mechanisms. That's the pitch, anyway.
The Paragon Playbook
Mentari didn't materialize out of thin air. It's a product of Paragon Biosciences, the Chicago-based company builder led by Jeff Aronin. Paragon's model is closer to a venture studio than a traditional VC fund. They identify an unmet medical need, build a company around it from scratch, fund it aggressively, and push it toward clinical milestones.
The track record gives the model some credibility. Paragon has deployed over $1.3 billion into portfolio companies since 2017. Its most notable success is Harmony Biosciences, which went public and now runs multiple Phase 3 programs in neurology. Other spinouts include Emalex Biosciences (Tourette syndrome) and Castle Creek Biosciences (rare skin diseases).
Mentari's board reflects Paragon's fingerprints. Julie Bruno, a Growth Partner at lead investor Fairmount, will serve as chair. The governance structure keeps control firmly with Mentari's backers, not with InMed's legacy shareholders.
What InMed Shareholders Get (and Don't)
Let's be honest about what this deal means for InMed's existing investors. Their 1.5% stake in the combined company is a far cry from control. But given that InMed's stock had plummeted over the prior year and was hovering near penny-stock territory, the alternative wasn't exactly rosy.
InMed shareholders will also receive contingent value rights (CVRs), essentially IOUs that pay out if someone licenses or buys InMed's legacy Alzheimer's and eye disease programs down the road. Those payouts are not guaranteed. They're more like lottery tickets tucked inside a going-away card.
The deal is expected to close in the second half of 2026, pending shareholder approval and standard regulatory conditions.
The Multibillion-Dollar Question
The global CGRP inhibitor market is projected to reach roughly $4 to $5 billion in 2026 and could grow substantially through the end of the decade. That's a massive commercial opportunity, and it exists precisely because current therapies leave so many patients undertreated.
Mentari is years away from competing for a slice of that market. MT-001 won't have proof-of-concept data until 2028. MT-002 is even further behind. The $290 million war chest should fund operations through 2028, but reaching commercialization will almost certainly require more capital.
Still, the competitive landscape validates the thesis. Lundbeck is already running a Phase 2b trial (called PROCEED) with its own anti-PACAP antibody, and early results from its Phase 2 HOPE study showed a statistically significant reduction in monthly migraine days versus placebo. The biology appears to work. The question is whether Mentari can build a better version.
With nearly $300 million, a who's-who investor syndicate, and a scientific rationale that fills a genuine gap in migraine care, Mentari is making one of the bigger preclinical bets in recent memory. Whether it pays off won't be clear for years. But for the millions of migraine patients still searching for relief, having another serious contender in the ring is the kind of news that actually matters.
Clinical & Regulatory
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