Karuna names Lilly veteran, ex-Voyager CEO Steven Paul as leader

Steven Paul, M.D., has taken over as CEO of Karuna Pharmaceuticals. The appointment puts the Sage and Voyager co-founder in charge of advancing a muscarinic agonist he worked on at Eli Lilly in the 1990s.

The muscarinic agonist came unstuck in the clinic. But the difficulties faced by xanomeline stemmed from concerns about safety, not efficacy. Karuna thinks it can mitigate the side effects seen in Lilly’s Alzheimer’s and schizophrenia clinical trials by administering it with trospium chloride, a muscarinic antagonist that only acts outside of the brain or central nervous system.

Paul, who worked on xanomeline during his 17 years at Lilly, gave credence to Karuna’s idea earlier this year when he became chair of the board and joined with VCs including ARCH Venture Partners to power the startup to a $42 million series A.

The naming of Paul as CEO cements the relationship and gives Karuna a leader with considerable CNS drug development experience. Early in his career, Paul rose through the ranks at NIH to become the scientific director of the National Institute of Mental Health. In the early 1990s, Lilly lured Paul into industry. Paul went on to spend 17 years at Lilly and serve as president of Lilly Research Laboratories.

More recently, Paul co-founded two of the hottest biotechs in the CNS sector: Sage and Voyager. Paul worked as CEO of Voyager until earlier this year, guiding it through a period in which it landed deals with AbbVie and Genzyme, went public and moved a Parkinson’s program through the clinic.

Paul will now bring his experience and expertise to bear on the development of xanomeline and trospium chloride. That prospect has whetted the appetite of investors with a stake in Karuna.

"I worked closely with Steve at Sage Therapeutics and his experience and creativity in the field is rare," ARCH’s Robert Nelsen said in a statement. "KarXT’s potential to meet unmet patient need is exciting and Steve’s experience is perfectly aligned to support Karuna’s goal of delivering first-in-class drugs for treating psychosis, cognitive impairment and pain."

With Paul taking over as CEO, Karuna co-founder and founding CEO Andrew Miller, Ph.D., has moved over to the COO post.

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