“The patient achieving these milestones so early in treatment, coupled with the improvements in breathing patterns and quality of sleep that we have observed, are highly encouraging and support the potential of TSHA-102,” said Rossignol, an associate professor of neuroscience and pediatrics at CHU Sainte-Justine, an affiliate of the University of Montreal.

Rett syndrome is estimated to affect 15,000 to 20,000 people in the U.S., U.K. and Europe.

“We were largely expecting this to be a ‘check the box’ on safety readout, but we’re pleasantly surprised to hear some promising effects, considering the patient was far along in disease progression and it was [a] low dose,” wrote Cantor Fitzgerald analyst Kristen Kluska in a note to clients.

Taysha said it received clearance from the U.S. Food and Drug Administration to start clinical development of the drug in pediatric patients. It’s also planning to review with the FDA the regulatory path for another of its drugs, TSHA-120 for giant axonal neuropathy, an ultra-rare inherited genetic neurodegenerative disorder with no approved treatments.

The $150 million in funding arrives just as Taysha’s cash for drug development is depleted. It had just over $45 million in cash at the end of June, down from $87 million at the end of 2022.

The company got off to a rapid start in 2020, raising over $150 million from investors for an ambitious drug development pipeline containing over a dozen gene therapies before going public less than five months later. It partnered with the UT Southwestern Medical Center to expedite researchers’ development of treatments for both rare and prevalent diseases affecting the central nervous system.

But its rocket start began to fizzle a year and a half later, forcing Taysha to pull back on its pipeline to extend its cash. Its research and development costs had soared to $131.9 million in 2021, up from $31.9 million in 2020. Last year, the company lost over $166 million.

It refocused on its Rett syndrome and giant axonal neuropathy therapies, laying off 35% of its workforce and canceling plans to build a 200-person research lab in North Carolina’s Research Triangle Park. In December, the company replaced its founding chief executive, RA Session II, with its board chairman, Sean Nolan.