Dan Gil could not have anticipated the meteoric rise his hair loss biotech Pelage Pharmaceuticals would have after releasing early data for its lead asset, PP405, showing hair regrowth in patients with the most common form of alopecia.
The buzz began when UCLA, where the technology originated from, wrote an article about the therapy. “Next thing we knew, we were on Anderson Cooper,” Gil told BioSpace in an interview at the J.P. Morgan Healthcare Conference in January.
The rapturous response, spurred by an active community of hair loss sufferers on social media sites like Reddit, overwhelmed the tiny biotech.
“That is not our area of expertise. We’re scientists,” said Christina Weng, chief medical officer and the physician-scientist half of the leadership team. “It definitely reflects an increased consumer interest in good science. And I think that story, even without us doing the best job, necessarily, telling it, is taking off on its own.”
Lotions And Potions
Years before PP405 had its moment in the spotlight, scientists began to see promise in the molecule, which activates stem cells in hair follicles to stimulate hair growth. This process basically reinvigorates hair follicles that had previously fallen dormant, allowing regrowth in areas that were formerly bald.
PP405 represents the first major advancement for androgenetic alopecia, more commonly known as pattern hair loss, in decades, the CEO said.
The company is pursuing a Phase III trial for its topical stem cell-rejuvenating molecule that aims to reactivate hair growth.
“It’s been kind of a dormant area of lotions and potions, and we’re finally seeing people begin to recognize that there’s actually a lot of really cool science to be done there,” Gil said.
Weng, a dermatologist who still sees patients with hair loss as a physician, said the standard of care has been the same for decades. There are just two approved treatments—only one of which is cleared for women—minoxidil, or Rogaine, and finasteride. These therapies take a long time to provide minimal results, if any. Often a patient will need to try for a year or more to even label the treatment attempt a failure, Weng added.
And most troublingly, these drugs have debilitating side effects—such as sexual and mood changes—that can last long after treatment stops.
In that vacuum, desperate patients have indicated that they are willing to spend good money on treatments without any scientific or clinical validation, Weng said.
So when news about PP405 began to spread, Gil and his team had a major concern: that misinformation would take over the narrative.
“There were people were running around saying, ‘Oh, this thing works in a week,’ or, ‘You’re gonna have a full head of hair in three weeks,’” he remembered. “[It’s] nice that people are excited, but of course, you don’t want there to be unreal expectations either.”
Instead, PP405 takes a little bit longer than that and the results are a bit more subtle at first. The Phase IIa trial that read out in June 2025 showed that 31% of male patients with a higher degree of hair loss had a greater than 20% increase in hair density at week eight—which was four weeks after the completion of treatment. No patients in the placebo arm hit this exploratory endpoint.
Usually, treatments for baldness require up to a year to begin to show efficacy. Pelage concluded that, based on the exploratory endpoints, PP405 seems to spur hair regrowth much faster than available options.
Weng said that PP405 is actually regrowing terminal hairs, which are the thick, pigmented hairs that grow longer. Other treatments typically spur growth of vellus hairs, rather unaffectionately known, in hair loss circles anyway, as peach fuzz.
Building The FOMO
PP405’s results also struck a chord with investors. While Pelage had planned to raise cash, the Phase II trial success accelerated the timeline, and in October 2025, the biotech collected $120 million in series B funds.
“We were very methodical and thoughtful about preparing for the raise,” Gil said. The company didn’t simply ride the buzz and cash the checks; Gil said they really parsed the data to give investors the clearest possible portrait of the potential of PP405, including the potential for subgroups to have even better efficacy. The team also set clear expectations of Pelage’s prospective valuation and conducted consumer and physician surveys to understand the unmet patient need.
A new generation of companies is eyeing the existing, sizeable hair loss market, hoping that better formulations and new scientific targets will finally produce treatments that are safer and more effective, as well as commercially successful.
“We had fielded a lot of incoming interest and sort of kept them at bay a little bit, so that maybe helped the FOMO a little bit,” Gil said.
Pelage is moving PP405 into late-stage trials thanks to the raise, which should bring provide the company with runway all the way to the FDA’s desk with an approval application. Gil said the first part of the year will be spent engaging with the FDA to confirm the trial design and endpoints.
Pelage’s mailboxes are overflowing with inbound interest from patients clamoring to get into the Phase III clinical trial for PP405, meaning recruitment won’t be a problem. Weng said this will allow the company to get the population just right to secure an indication in androgenetic alopecia.
A Little Help From GLP-1
Despite only being in the planning stages for Phase III, Gil is already thinking about how to market PP405. Luckily, a wave of interest in GLP-1 is helping there. The mega-blockbuster weight loss treatments from the likes of Eli Lilly and Novo Nordisk have brought the investment community back to more common ailments and the aesthetics space in general. Gil saw this firsthand while attending a dermatology summit the weekend before the J.P. Morgan conference in San Francisco.
Novo and Lilly are at the leading edge of a push to consumer-driven marketing and self-pay opportunities for patients. Gil intends to consider self-pay for PP405 when the time comes, which will be a boon for a small biotech like Pelage. The biotech would not have to set up a large salesforce and could stay independent, rather than seeking a buyout.
“In the past, if you’re going into an area where you need a large sales force, it’s almost prohibitive for a small company to even try to do that,” Gil said. “So it now puts us in a position where that’s an option for us.”
Veradermics is the second hair regrowth specialist to fundraise this week, after Pelage Pharmaceuticals announced Wednesday it had brought in $120 million for its own therapy.
Pelage is not alone in the burgeoning alopecia market. Veradermics is developing an oral extended-release version of minoxidil for pattern hair loss, which is in Phase III trials. Gil and Weng believe there could be combination opportunities in the future.
“It’s an interesting market as well, that the average consumer is trying three or four different things at a time,” Gil said, adding that this is a sign of an unmet need and the desperation patients feel.
Weng brushed off concerns, raised at the dermatology summit, that the hair loss space has suddenly become too crowded. She pointed to AbbVie’s all-time best seller Humira, which changed the treatment paradigm for psoriasis and spurred a wave of investment in inflammation and immunology.
“Things didn’t end when Humira became available. And in fact, the more options became available, the larger [the] psoriasis [market] grew,” Weng said.
She sees the same opportunity for Pelage and PP405, led by the strong scientific foundation that the company is now championing with its time in the spotlight.
Pelage isn’t just breaking ground for hair loss, but for the entire biotech field, Gil insists.
“One of the things we’re all so excited about is, this is a regenerative medicine approach. And that phrase gets bandied about quite a bit in the aesthetics space. Everybody seems to be saying they’re a regenerative medicine company, but we actually are, because our mechanism is turning stem cells back on to create and regenerate a new hair follicle.”