Life Sciences Companies Begin 2011 in Stronger Financial Positions

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 |  About: Pfizer Inc. (PFE)
by: The Burrill Report

By Marie Daghlian

European companies closed significant financing rounds in the first week of 2011 as four companies raised close to $278 million, a good sign that their fortunes may be looking up in the coming year.

The largest funding, and the largest financing ever for a private European biotech company, was completed by Danish biotech Symphogen, a company developing antibody therapeutics to treat cancer, and infectious and autoimmune diseases. The Copenhagen-based company closed a $134 million (€100 million) placement of preferred stock to a group of investors led by Novo A/S. The round also included Essex Woodlands Fund VIII and the Danish Pension Fund PKA, which joined as a new investor. The funding will be disbursed in three tranches.

Symphogen intends to use the proceeds to accelerate advancement of its lead clinical oncology product Sym004, currently in an early stage trial in patients with advanced solid tumors, as well as its other clinical and preclinical oncology opportunities both for proprietary pursuit and partnering. The company has partnerships with Genentech and Japanese pharma Meiji Seika Kaisha.

Sym004 is a recombinant IgG1 antibody product consisting of two antibodies against the epidermal growth factor receptor and inhibits cancer cells by three separate and complimentary mechanisms of actions—ligand binding, activation and subsequent downstream signaling of the EGF receptor. It also induces rapid and efficient internalization and degradation of the EGF receptor causing immune-mediated killing of the cancer cells.

Dutch medical device company PneumRx closed a series C funding of $33 million led by Forbion Capital Partners in an oversubscribed offering that included a syndicate of existing investors. The company has developed a minimally invasive device intended to improve lung function in emphysema patients by bronchoscopically implanting Nitinol coils into the lungs to compress damaged tissue and restore elastic recoil to the lung. It offers an alternative to lung volume reduction surgery, and works independently of collateral ventilation. More than 1,500 of its devices have been implanted to date in over 170 procedures. Its system is CE marked and is currently available in select markets in Europe, with plans for broader expansion.

PneumRx plans to use the funds to expand European commercialization and to conduct an FDA-approved pivotal clinical trial in order to get approval to sell its device in the United States.

Paris-based biotech DBV Technologies raised $25.5 million (€19.4 million) in a series C round led by new investors InnoBio Fund and Lundbeckfond Ventures, with participation by Shire, ALTO Invest, Sofinnova Partners and ALK Abello DBV Technologies is developing products to combat food allergies such as peanut and milk. Its products are designed to deliver allergens through a skin patch.

Danish biotech LifeCycle Pharma completed its fully subscribed rights offering of almost 4 million new shares to raise $85 million, in a strong show of support by many new investors. The funds will be used primarily to complete its late-stage program of LCP-Tacro, a once-daily formulation of the immunosuppressant drug tacrolimus. The formulation incorporates LifeCycle Pharma’s technology to improve bioavailability and provide consistent pharmacokinetic performance and reduced peak-to-trough variability when compared to currently approved tacrolimus. The company has two ongoing trials, one in stable kidney transplant patients and one in newly transplanted patients.

Danish biopharma Santaris Pharma expanded its strategic alliance with Pfizer (NYSE:PFE) and landed $14 million upfront with a potential $600 million more in developmental milestones. Their collaboration is focused on the development and commercialization of RNA-targeted drugs using Santaris’ Locked Nucleic Acid drug platform.

Under the terms of the expanded agreement, Pfizer will pay $14 million for access to Santaris’ technology for the development of RNA-targeted drugs. Santaris is eligible to receive milestone payments of up to $600 million as well as royalties on sales of products that may be developed for up to 10 new RNA targets selected by Pfizer.

The deal builds on the original collaboration formed in January 2009 between Santaris Pharma and Wyeth, which was later acquired by Pfizer. Under the terms of the original collaboration, Santaris received an upfront payment of $7 million and an equity investment of $10 million. Santaris will still be eligible to receive milestones and royalties under the original alliance, under which Pfizer has advanced several programs and reached a number of early milestones since its inception.

DEALS FOR THE WEEK ENDING JANUARY 7, 2011

Global Venture Financings
Company Location Amount Raised (USD M) Principal Activity
ReCyte Therapeutics Alameda, CA 4.0 Stem cells/banking
Genocea Biosciences Cambridge, MA 35.0 T-cell-based vaccines
Gliknik Baltimore, MD 3.5 Cancer; autoimmune
PneumRx Naarden, The Netherlands 33.0 Respiratory
Symphogen Copenhagen, Denmark 134.0 Antibody therapeutics
PanOptica Mount Arlington, NJ 30.0 Ophthalmology
EyeGate Pharma Waltham, MA 5.9 Ophthalmology
DBV Technologies Paris, France 25.5 Allergy immunotherapies
Aratana Therapeutics Kansas City, KS 20.0 Animal health
Graftys Aix-en-Provence, France 5.3 Bone tissue engineering
CardioInsight Technologies Cleveland, OH 4.0 Electrocardiograp imaging
Neuroptix Acton, MA 4.6 Alzheimer's
23andMe Mountain View, CA 9.0 Personal genomics
Sera Prognostics Salt Lake City, UT 1.4 Women's health
Augmenix Waltham, MA 3.0 Radiation oncology
Doctors Research Group Southbury, CT 7.7 Bone cement for cranial defects
Total Raised US 128.1
Total Raised Non-US 197.8
Grants
Company Funding/Contracting Agency Amount Raised (USD M) Principal Activity
ChromaDex National Science Foundation Phase II SBIR 0.5 Anthocyanins for use in nutraceuticals
Acceleron Pharma Muscular Dystrophy Association 1.5 MS drugs
Constellation Pharmaceuticals Multiple Myeloma Research Foundation 1.0 Cancer drugs
Epizyme Multiple Myeloma Research Foundation 1.0 Cancer drugs
Karyopharm Therapeutics Multiple Myeloma Research Foundation 1.0 Cancer drugs
Virent Energy Systems Binational Industrial Research and Development Foundation 0.5 Cellulosic biofuels
HCL CleanTech Binational Industrial Research and Development Foundation 0.5 Cellulosic biofuels
Total Grants 6.0
Public Financings
Company Ticker Amount
Raised (USD M)
Financing Type
Zhendong Pharma (China) SZ:300158 211 IPO
Echo Therapeutics OTC:ECTE 5.5 PIPE
Pro-Pharmaceuticals OTC:PRWP 2.1 PIPE
Stem Cells STEM 10.0 PIPE
Ohr Pharmaceuticals OTC:OHRP 1.1 PIPE
Uluru NYSE Amex:ULU 0.5 Registered Direct
Adventrx Pharmaceuticals NYSE Amex:ANX 22.5 Registered Direct
Kangmei Pharma (China) SHEX:60051 529.0 Follow on
Amarin (Ireland) AMRN 100.2 Follow on
LifeCycle Pharma (Denmark) OMX:LCP 85.0 Rights offering
WebMD WBMD 350.0 Debt
Advanced Cell Technology OTC:ACTC 4.0 $25M non-convertible stock purchase agreement
SeraCare Life Sciences SRLS 20.0 Credit facility
NMT Medical NMTI 2.0 Credit facility
Total Public Financings-US 417.7
Total Public Financings-Non-US 925.2
M&A
Acquirer Target Deal Value
(USD M)
Focus
Hologic Interlace Medical 125.0 Medical devices
Aceto Rising Pharmaceuticals 80.0 Drug distributor
Footstar CPEX Pharmaceuticals 76.6 Specialty pharma
Boston Scientific IntElect Medical 60.0 Deep brain stimulation
Meda (Sweden) GlaxoSmithKline (United Kingdom) 26.0 OTC products
Merck KGaA (Germany) Beijing Skywing Technology (China) 18.2 Tools/Technology
Beijing Double-Crane Pharma (China) Shenyang Enshi Pharma (China) 13.7 Antibiotics
Sigma-Aldrich Cerilliant N/A Tools/Technology
Lab21 (United Kingdom) Microgen Bioproducts (United Kingdom) N/A Diagnostics
Alliances
Company/Licenser Company/Licensee Deal Value
(USD M)
Focus
Santaris Pharma (Denmark) Pfizer 614.0 mRNA and microRNA
Xoma Servier (France) 505.0 Inflammation
Seattle Genetics Pfizer 208.0 Antibody drug conjugates
Immutep (France) GlaxoSmithKline (United Kingdom) 100.0 Autoimmune
Ligand Pharmaceuticals Chiva Pharmaceuticals 100.0 Drug development
Apricus Biosciences Elis Pharma (UAE) 2.1 Genitourinary
Siemens (Germany) PositiveID N/A Digital Health
Response Biomedical (Canada) Cremascoli & Iris (Italy) N/A Cardiac POC tests
BG Medicine Siemens Healthcare (Germany) N/A Diagnostics
Albany Molecular Research Genentech/Roche (Switzerland) N/A Antibacterials
Kiadis Pharma (Netherlands) Hospira N/A Hematology
Transposagen Biopharmaceuticals Cellular Dynamics N/A Stem cells
Kinaxo Biotechnologies (Germany) AstraZeneca (United Kingdom) N/A Oncology
Synageva BioPharma to-BBB (Netherlands) N/A Brain drug delivery
X-Body BioSciences Mercator Therapeutics N/A Oncology
Spirogen (United Kingdom) Genentech/Roche (Switzerland) N/A Antibody drug conjugates
Plexxikon Genentech/Roche (Switzerland) N/A Oncology
Receptos Eli Lilly N/A GPCR modulators
Receptos Ortho-McNeil-Janssen Pharmaceuticals (J&J) N/A GPCR technology
Amgen MedImmune (AstraZeneca-United Kingdom) N/A Anti-inflammatory
Intrexon Ziopharm Oncology N/A Oncology
Sutro Biopharma Pfizer N/A Peptide-based therapeutics
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