Lead candidate, a sustained-release formulation of dexamethasone, is being tested in Meniere disease.

Otonomy completed a $10 million Series A financing with Avalon Ventures. The funding will be used to support ongoing clinical investigations of OTO-104 in Meniere disease, initiate IND-enabling studies for OTO-203, and continue early-stage development of a third program.

OTO-104 is a sustained-release formulation of the steroid dexamethasone. Otonomy is conducting a prospective, randomized, placebo-controlled, multicenter Phase Ib study with OTO-104 given as a single intratympanic (IT) injection in subjects with unilateral Meniere disease. Preclinical studies have demonstrated that the compound can effectively deliver a prolonged and dose-proportional exposure of dexamethasone to the inner ear and is well-tolerated in a broad set of safety evaluations, according to the company.

The firm is also planning studies with OTO-104 for acute hearing loss. OTO-203 is a sustained-release antibiotic being developed for the treatment of otitis media. Otonomy’s pipeline is focused on therapies for disorders of the inner and middle ear.