Lycia Therapeutics Raises $75M for LYTAC Degrader Platform in Autoimmune Push

$75 million. Oversubscribed. For a platform most biotech investors haven't heard of — yet.

Lycia Therapeutics, a South San Francisco biotech built on Nobel Prize-winning chemistry, closed its Series D on June 25. The round was co-led by Janus Henderson and Balyasny Asset Management, with participation from a syndicate that includes Eli Lilly and Venrock Healthcare Capital Partners. The money will fund clinical trials for two programs: LCA-0061, a catalytic degrader of immunoglobulin E for allergic diseases, and LCA-0321, a LYTAC degrader targeting the autoantibodies that cause Graves' disease.

Both programs target extracellular proteins — the universe of disease drivers that sit on cell surfaces or circulate in blood, untouched by conventional small molecules and largely inaccessible to standard biologics.

The timeline: from academic paper to clinical-stage company

TIMELINE: Lycia Therapeutics
─────────────────────────────────────────────────────────────
  2019 ──── 2020 ──── 2022 ──── 2024 ──── Jun 2026
  🧪         💰         🏆          💰           ◉ NOW
  Founded    Series     A Nobel    Series C     Series D
  +          $70M       Prize      $106.6M      $75M
  Versant    Series B   (Bertozzi)             + Lilly
                        + Lilly
                          collab
                        $1.6B biobucks

Lycia was founded in 2019 inside Versant Ventures' Inception Discovery Engine in San Diego. The science came from the lab of Carolyn Bertozzi, then a Stanford professor whose 2022 Nobel Prize in Chemistry recognized her founding of bioorthogonal chemistry — a field that lets researchers study biomolecules inside living organisms without disrupting them.

Bertozzi and her team published the first LYTAC paper in Nature in July 2020. The molecule class works like this: a LYTAC (lysosomal targeting chimera) has two ends — one binds a target protein, the other binds an internalizing receptor on the cell surface. It piggybacks the target into the cell, where the lysosome, the cell's protein incinerator, destroys it.

What makes this different from existing protein degradation platforms is location. Every approved degrader — including Arvinas' bavdegalutamide and Kymera's KT-474 — works inside the cell, targeting cytosolic proteins through the ubiquitin-proteasome system. LYTACs work outside the cell. They target the estimated 40% of disease-relevant proteins that are secreted or membrane-bound: antibodies, cytokines, growth factors, receptors.

The pipeline: two shots at clinical proof-of-concept

Lycia's lead program, LCA-0061, is a catalytic degrader of IgE — the antibody responsible for allergic reactions. In preclinical studies in non-human primates, a single dose eliminated total and free IgE rapidly and durably. The comparison drug, Roche/Novartis' Xolair (omalizumab), blocks IgE rather than removing it. Xolair's effect plateaus; patients on high IgE levels are often ineligible. The approach clears IgE from the system, not just neutralizes it.

The addressable market is large. IgE-mediated diseases cover food allergy, allergic asthma, and chronic spontaneous urticaria. Xolair, which does less, generated about $5 billion in lifetime sales. If LCA-0061 works in humans the way it works in primates, the substitution case is worth taking seriously.

LCA-0321 targets Graves' disease, an autoimmune condition where the body produces autoantibodies that overstimulate the thyroid. Current treatment is limited to anti-thyroid drugs with high relapse rates, or permanent thyroid ablation followed by lifelong hormone replacement. Its degrader selectively depletes the anti-TSHR autoantibodies without general immunosuppression. The company plans to start Phase 1 trials for both programs.

What the Series D buys

The $75 million round was oversubscribed, which in the current biotech funding environment is a signal. Biotech venture financing through May 2026 totaled $5.9 billion across 54 deals, roughly flat with the comparable 2025 period by capital but up in deal count, per PitchBook and New Market Pitch data. Oversubscribed rounds in this market are reserved for platforms, not single-asset companies.

Lycia's investor syndicate includes crossover funds (Janus Henderson, RTW), specialist healthcare (OrbiMed, HBM, Venrock), and strategic pharma (Eli Lilly). Its continued participation is notable — the companies have had a collaboration since 2021, with the pharma partner paying $35 million upfront and up to $1.6 billion in biobucks across five targets. The fact that it is writing another check, rather than letting the option expire, implies internal validation: the pharma's R&D organization sees Lycia's platform generating candidates worth co-developing.

Lycia also strengthened its executive team alongside the raise, appointing Amy Bachrodt as CFO and promoting Karen Flick to general counsel — signal that the company is preparing for the organizational complexity of clinical-stage operations.

What this means for the protein degradation field

Targeted protein degradation has been one of biotech's most-hyped modalities since the early 2010s. The first wave produced intracellular degrader companies (Arvinas, Kymera, Nurix, C4 Therapeutics). The second wave is extracellular.

The company is not alone in this space. Avilar Therapeutics, a RA Capital-backed startup, is developing ASGPR-directed degraders. Orum Therapeutics has antibody-based degradation approaches. But it has two advantages: a Nobel Prize-winning founder whose lab continues to publish foundational work on the mechanism, and a pharma partner that has committed the resources to test the platform at scale.

The key question is clinical translation. LYTACs work in non-human primates. So did many modalities that failed in Phase 2. The field's history is littered with elegant mechanisms that could not survive the transition from bench to bedside. The company's CMO, Chin Lee (appointed February 2025), has 20 years of clinical development experience bringing therapies from Phase 1 through commercialization. The company now has the capital to generate human data. The rest is execution.

Key signals to track

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