ActoGeniX Series B to Move IBD Program to IND Stage
By Marie Powers
ActoGeniX NV closed a Series B equity financing round, raising €10.7 million (US$14 million) to move its ActoBiotics program to the investigational new drug application (IND) stage in a second indication of inflammatory bowel disease (IBD).
The financing, which brings the company's total raise to €46.2 million across three equity rounds, was led by new investor Saffelberg Investments with participation from the company's founders and current investors GIMV, Biotech Fund Flanders, Baekeland Fund, BioVest CVA, Life Sciences Partners, Aescap Venture and Ventech.
"It took a while" to assemble the round, acknowledged Bernard Coulie, ActoGeniX CEO, "like most of these refinancing runs, these days."
The capital will see the company through the end of 2014, and "it's our intention to look at additional funding," Coulie told BioWorld Today. "The round isn't entirely closed."
ActoGeniX, of Ghent, Belgium, began assembling the financing last summer. The process picked up speed in the fall after Merck & Co. Inc., of Whitehouse Station, N.J., inked a research partnership to develop and validate a new therapeutic approach in an undisclosed indication using the ActoBiotics platform. The companies are collaborating on the oral administration and local enteric delivery of antibodies that are expressed and secreted at the enteric mucosa by the ActoBiotics technology.
ActoGeniX is developing its orally administered and locally acting ActoBiotics across a range of indications. Its lead candidate, AG013, targets oral mucositis, a frequent complication of cancer treatment. The FDA approved the IND application for AG013 in May 2009. Last year, the compound demonstrated initial efficacy in a Phase Ib study, including a 35 percent reduction in the duration of ulcerative oral mucositis compared to placebo. Nearly 30 percent of patients treated with AG013 were full responders, while all placebo-treated patients developed ulcerative oral mucositis.
The company plans to move AG013 into a Phase II/III study in the second half of the year in collaboration with several U.S. oncology centers and is actively seeking a partner to license or co-develop the compound.
ActoGeniX has two IBD candidates. AG014 comprises oral delivery of an anti-TNF antibody with proven clinical efficacy in IBD, resulting in local efficacy and an improved safety profile over systemic drugs. The company also is developing AG015, an ActoBiotic that expresses and secretes the anti-inflammatory cytokine IL-27 in IBD and celiac disease, in collaboration with the National Cancer Institute. The program generated positive efficacy data in an animal model of colitis.
The Series B will allow ActoGeniX to move the IBD candidates, in parallel, to the IND stage "a key value inflection point for us," Coulie said. Additional funding whether through a second equity tranche or a strategic partnership will enable the company to move the compounds into proof-of-concept studies.
"There's no pressure here," Coulie observed. "We still have plenty of work to get the products to IND stage."
The company also has preclinical candidates in Type I diabetes and allergic diseases.
ActoBiotics are designed to heighten the advantages of existing biotech products with the goal of creating next-generation blockbuster drugs, Coulie explained. They combine the high selectivity and low toxicity of protein-based biopharmaceuticals with oral availability and cost-effective manufacturing and formulation.
The pipeline is based on the company's TopAct technology, which transforms the food bacterium Lactococcus lactis into genetically engineered strains for in situ production. The platform can deliver a wide range of therapeutic peptides and proteins, including cytokines, enzymes, hormones and monoclonal antibodies.
"We have a fairly unique platform," Coulie said. "I know everybody says the same thing, but we have found a way that allows for the oral administration of a biological. It's safe, efficacious and relatively cheap to produce. That's the sweet spot for a number of pharma companies."
The company proved its mettle by taking its initial compound into the clinic, providing "a certain level of validation" for the company's platform and increasing the comfort level of investors, according to Coulie. However, the Merck collaboration was a big win for the small biotech, attracting other potential partners to the table.
"The deal with Merck made a difference," Coulie said. From "the moment the agreement was signed," ActoGeniX saw a spike in interest not only from potential pharma partners but also from investors.
Founded in 2006 as a spin-off from the Vlaams Instituut voor Biotechnologie in Brussels and from Ghent University, the company has a broad intellectual property position. Its patent estate encompasses more than 20 distinct patent families, with broad claims already granted in the U.S. and Europe.
In other financings news:
ERYtech Pharma SA, of Lyon, France, has had its prospectus accepted for a proposed initial public offering on the NYSE Euronext exchange in Paris. ERYtech develops and produces protein therapeutic products, primarily in the areas of hematology, cancer and metabolic disorders.
MediciNova Inc., of San Diego, said in an SEC filing that it entered an equity distribution agreement with Macquarie Capital Inc. (MCUS) to sell shares of common stock up to an aggregate of $6 million from time to time, through MCUS as sales agent. The company, which ended the first quarter with about $7.4 million in cash, equivalents and working capital, has prioritized work on MN-166 (ibudilast), which is in Phase I and Phase II studies for drug dependence and pain, largely through investigator-sponsored trials. In its earnings release, MediciNova said proceeding with a Phase IIb trial in progressive multiple sclerosis would be dependent on receipt of funding. Shares (NASDAQ:MNOV) gained 16 cents to close Thursday at $2.54.
Northwest Biotherapeutics Inc., of Bethesda, Md., said it entered an agreement with one health care-dedicated institutional investor for a registered direct placement of $10 million of common stock at the closing market price of $3.90 apiece. The company also will issue to the undisclosed investor warrant coverage of about 40 percent. H.C. Wainwright & Co. LLC acted as exclusive placement agent. Northwest is developing DCVax personalized immune therapies for solid tumor cancers and is in Phase III testing in newly diagnosed glioblastoma multiforme. Shares of Northwest (NASDAQ:NWBO) fell 13 cents to close Thursday at $3.77.
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