Less than two years after its founding and 10 months after licensing its technology from Seattle's Fred Hutchinson Cancer Research Center, privately held Blaze Bioscience Inc. raised $5 million in a Series A financing.

Investors included a pool of local and regional organizations and individuals with biotech and medical affiliations, according to Heather Franklin, Blaze's co-founder, president and CEO.

The funds will be used to advance the Seattle-based company's "tumor paint" technology, which was developed and licensed from the laboratory of company co-founder Jim Olson, a pediatric neuro-oncologist at Hutchinson.

Tumor paint (formerly CyTP 007) provides real-time, high-resolution visualization of cancer cells during surgery, enabling better detection and more complete and precise surgical resection. The concept emerged from Olson's frustration with the shortcomings of preoperative imaging studies in providing clear margins during pediatric brain cancer. Postoperative imaging studies sometimes revealed that, despite painstaking surgeries that lasted 12 hours or more, "billions of cancer cells had been left," Franklin told BioWorld Today.

The technology, which combines a targeting peptide and a fluorescent beacon, is under development in multiple solid tumors. The term reflects the concept that each tumor cell is marked for removal, resulting in margins that "blaze."

The firm's management team previously worked together at Seattle's ZymoGenetics Inc., which had a number of partnerships, including a $1.1 billion collaboration with Bristol-Myers Squibb Co. on a PEG-interferon lambda candidate in hepatitis C. The big pharma then acquired Zymo in 2010 for $885 million. (See BioWorld Today, Jan. 14, 2009, and Sept. 9, 2010.)

Once the acquisition closed, Olson convinced Franklin, who had worked across the street from Hutchinson as Zymo's senior vice president of business development and alliance management, that tumor paint was ready to move out of the lab. The two formed Blaze shortly afterward with $1.3 million in seed funding.

Tumor paint, which Olson and colleagues originally described in 2007 in Cancer Research, is a scorpion-derived peptide called chlorotoxin linked to a molecular beacon that emits photons in the near-infrared spectrum. The illumination gives surgeons a better chance of removing cancerous cells during surgery without injuring surrounding healthy tissue. That is particularly significant in the brain, where approximately 80 percent of malignant cancers recur at the edges of the surgical site. Olson's lab has demonstrated detection of fewer than 200 cancer cells under simulated operating conditions, making it 100,000 times more sensitive than magnetic resonance imaging.

The Olson lab has conducted preclinical studies of tumor paint for real-time, high-resolution visualization not only in brain cancer but also in lung, prostate, breast, pancreas and colorectal cancer.

"We are focused on this particular peptide and target, which seem to be expressed on a wide variety of cancer cells," Franklin said.

Going forward, the Series A will provide a runway of approximately 18 months and allow Blaze to move tumor paint into manufacturing scale-up and toxicology studies, she added. The company plans a Phase I/II structure, which should provide data in three years or less, but has not yet determined whether studies will be conducted in Seattle or in multiple sites.

With five employees, "we plan to stay very lean," Franklin said, operating mainly with contract research and manufacturing organizations to remain capital-efficient.

Long term, Blaze will seek to partner the technology – ideally, after human trials. The company already has been approached by potential partners intrigued by tumor paint, "but we want to put this in the best hands once we have that initial data, since we'll be looking at a wide number of tumor types," Franklin said.

The timing is perfect, she added, since "there's a lot of activity starting in this space. The concept has caught hold of people's imaginations."

For example, Specialised Therapeutics Australia Pty. Ltd., of Melbourne, Australia, has Gliolan, a 5-aminolevulinic acid-based drug designed to aid neurosurgeons in visualizing and removing malignant brain tumors, which was granted orphan status by Australian regulators. The company expects to file for approval in Australia later this year.

And Franklin said several U.S. start-ups are exploring similar technologies but without the level of resolution, specificity or broad applicability of tumor paint.

In fact, Franklin welcomes the competition, since "they're paving the regulatory path for us," she said.

In other financings news:

• Novelos Therapeutics Inc., of Madison, Wisc., priced a public offering of 5.4 million units at $1 each. Each unit consists of one share of common stock, a Class A warrant with a five-year term to purchase a half-share of stock at $1.25 each and a Class B warrant with a 90-day term to purchase one share of stock at $1 per share. Novelos expects to close the transaction on or about June 13. Rodman & Renshaw LLC is acting as exclusive placement agent.