Have you ever found yourself at a restaurant or party and had trouble hearing what your friend is saying to you among all of the background noise? That is central auditory processing disorder (CAPD), when the brain does not work fast enough to distinguish between many sound sources. CAPD results in the type of hearing loss that takes place in the brain rather than at the level of the ear. Hearing aids cannot solve the problem of CAPD, which affects 50% of the population at age 65 and one-third of the population of people in their 40s and 50s.
Achim Klug, PhD, is testing a novel method to solve central auditory processing disorder (CAPD). Klug believes his unique combination of drug and sound therapy will solve the problem of central hearing loss in 30 days. He says animal studies show an effectiveness of 90%.
Moreover, Klug has formed a company with Sam Budoff, PhD, called Parley Neurotech, Inc. They are in the early phases of raising funds for their company, currently closing what is called a priced seed round.
To be clear, Klug and Budoff do not know yet if their method will be as effective in humans as it has been in animals. That is where their Phase II clinical trial comes in.
Their story is a success in terms of translational science that has moved through the pipeline from an idea, through basic bench and preclinical science in animals, to the testing in humans of a treatment that could impact millions. And though 95% of new products introduced each year fail*, it is worth asking: What are the elements that brought Klug and his innovation to this crucial moment in time?
Funding
In 2011, Klug applied for a pilot grant from the Colorado Clinical and Translational Sciences Institute (CCTSI). He and Herman Jenkins, MD, received the Translational Medicine Team Award, which provided $90,000 from the CCTSI and an additional $10,000 from Jenkins’ department of Otolaryngology.
Klug said if you look at his CCTSI grant application from 2011, it contains the basic outline of his 2017 application for an R01 grant from the National Institutes of Health (NIH). (An R01 supports mature research projects with strong preliminary data.) The CCTSI grant enabled Klug to collect key data he used to apply for and receive additional funding. It also allowed him to pursue the science that underpins his clinical trial today.
“I am eternally grateful because the CCTSI grant allowed us to get the R01, and the next R01, and develop the treatment,” said Klug who is also professor of Physiology and Biophysics in the CU Anschutz School of Medicine. All of this leads to the next element that has been instrumental in Klug’s success: the multiple resources found in a large Academic Medical Center.
Supportive Infrastructure at CU Anschutz
Of course, funding is essential. But a grant by itself would not be as effective as one that is given within a large, supportive research and entrepreneurial ecosystem.
“I think it’s really important to highlight how great the CU Anschutz environment is,” said Budoff.
Klug said, “All the university resources coming together—CCTSI, CU Anschutz Innovations—they are so good at helping you find resources.”
In 2025, Innovations awarded Klug a Spark grant, which aims to accelerate the commercial development of promising technologies that have proven science and a high potential to impact patients. Innovations also filed a patent for Parley’s proprietary sound treatment, which works in tandem with the FDA-approved drug clemastine fumarate. Moreover, Parley and Budoff just competed in the Innovations Fast Pitch. They tied with another team and split the prize of $10,000.
Innovations also supported Klug and Budoff through the process of attracting seed funding from investors. These dollars will enable Parley Neurotech to complete its clinical trial and take steps to ensure the company is ready to launch operations on a national scale if the treatment receives approval from the FDA.
None of the investment from Innovations would be possible without the research Klug has been conducting for more than 15 years at CU Anschutz.
“In addition to the clinical trial expertise we have access to on campus, we are fortunate to work in a remarkably collaborative environment,” Klug said. “The basic science experiments and data would not have been possible without my close collaborators in the Department of Physiology and Biophysics, as well as other departments.”
Focus
Klug has been relentless in his focus on central auditory processing disorder (CAPD), when the brain does not work fast enough to distinguish between many sound sources. Yet the problem is not just that people cannot follow a conversation in a loud room. CAPD can lead to dementia: 1 in 12 dementia cases are associated with untreated hearing loss. And the risk is doubled for those struggling to hear in noisy places. Currently, no treatment is available for central hearing loss.
The brainstem has a special circuit that helps determine where sounds originate in the space around us. It is one of the fastest circuits in your brain. This circuit is wrapped in myelin, and the thicker the myelin wraps around a nerve, the faster it can communicate. Thinner myelin means slower communication. For the 60 million Americans with central hearing loss, the myelin in their brainstem has deteriorated, causing the circuit to slow down.
Klug and Budoff’s solution is called Localized Oligodendrocyte Optimization Therapy (LOOT). It pairs a proprietary sound therapy with a drug that is already FDA approved called clemastine fumarate. The engineered sound therapy drives the neural circuit activity, which enables the drug to re-myelinate these activated neural circuits.
LOOT is the first treatment that aims to reverse the neurological root cause of central hearing loss.
“The real reason we are going to succeed where no one else could is that Achim has dedicated the last 30 years of his life, to really understanding at a neural level how hearing and noise work,” Budoff said.
Collaborating Across Research Areas
The ability to collaborate with research colleagues outside one’s own discipline is essential to innovation. Klug explained how he came up with the idea of using clemastine fumarate, a drug that was FDA approved in the 1970s. “When axons demyelinate, they don’t work as well. This is the case in multiple sclerosis (MS) where a patient’s own body attacks the myelin and breaks it down. With MS, individuals have less myelin than they should have. We asked the MS medical community what drugs they have, they suggested clemastine fumarate.”
Klug continued that he was not looking for this particular myelination solution. But when he combined what he knew about hearing loss, neuroscience, and MS, the elements of his solution became clear to him.
Whether LOOT ultimately succeeds in human trials remains to be seen. Klug's journey, however, demonstrates how funding, collaboration and a supportive research system can help move an idea toward a potential treatment for millions.
“We took pieces from everybody’s book and put them together. That is what I really like about this project”, Klug said. “You have to be open to looking at what other people are doing in an unrelated field, seeing what they are finding, and asking if it has implications for you.”
*According to Clayton Christensen of Harvard Business School.