BioWorld Today Correspondent

Agennix AG grossed €78.4 million (US$107.8 million) – about €76 million net of expenses – in a combined rights offering and private placement that will enable it to continue development of its lead drug candidate, talactoferrin, which is being studied in cancer and sepsis.

The transaction was priced at €3.81 per share, a discount of around 10 percent on the company's share price of €4.23 on Sept. 15, immediately before the offering was finalized.

The deal gives the Planegg, Germany-based company enough cash to take it through the end of next year, acting CEO Friedrich von Bohlen told BioWorld Today. By then, it aims to have data in hand from its lead program, a Phase III clinical trial of talactoferrin in third-line non-small-cell lung carcinoma (NSCLC), which has so far recruited 443 patients out of a planned 702.

A Phase III trial of the drug in sepsis will also be under way at that point. "It is planned to start the sepsis trial in the early next year," von Bohlen said. That study will take two years to complete. It follows a recent Phase II trial, in which the drug almost halved the rate of mortality at 28 days – from 26.9 percent in the placebo arm to 14.4 percent in the drug treatment arm.

The company is seeking a deal for the compound, and discussions with potential partners are ongoing. Talactoferrin is a recombinant version of lactoferrin, an iron-binding glycoprotein found in human breast milk, which is an important component of the early innate immune system. It has multiple immunomodulatory effects, but its precise mechanism of action is still not fully understood. "It does change cellular responses and cytokine levels," von Bohlen said. "How this concretely maps to our clinical findings and vice versa still needs to be worked out."

Although a large protein – it has a molecular weight of 80 kiloDaltons – it can be administered orally. "We didn't have to think about this for too long. Mother Nature has given us the right route," von Bohlen said.

Agennix (and the talactoferrin program) began life in Houston, before merging with GPC Biotech AG, of Martinsried, Germany, in a deal supported by the German investment firm dievini Hopp BioTech holding GmbH & Co. KG. (See BioWorld Today, Feb. 19, 2009.)

dievini Hopp and affiliated funds, which are backed by the software entrepreneur Dietmar Hopp, have steadily increased their position in the enlarged company since then. Following the latest transaction, their combined equity stake has climbed from just over 29 percent to 59 percent.

Under German takeover rules, dievini Hopp is now obliged to make a mandatory takeover offer for Agennix, although it has sought a waiver from the German Federal Financial Supervisory Authority (Bundensanstalt fuer Finanzdienstleistungsaufsicht; BaFin).

Dietmar Hopp is one of Germany's most active biotechnology investors in recent years. This year, his funds have invested more than €100 million, said von Bohlen, who is also managing director of dievini Hopp. Its total portfolio is valued at more than €500 million.

Trading in the new shares will begin on Oct. 5. Piper Jaffray Ltd. and WestLB AG acted as joint global coordinators on the transaction.