Staff Writer

Taligen Therapeutics Inc. closed a tranched Series B financing round that eventually could bring the company as much as $65 million.

Woodruff Emlen, co-founder, president and CEO of Aurora, Colo.-based Taligen, declined to specify how much money the company is getting up front or how the round is tranched. But the funding will last Taligen "several years," he said, and will allow the company to complete preclinical work and move into clinical trials with its drug candidates targeting complement proteins.

Complement proteins, part of the innate immune system, work upstream in the inflammation cascade and have long been thought to play a role in a variety of inflammatory diseases.

More recently, research has linked various complement factors to age-related macular degeneration (AMD), a fact that Emlen said made Taligen's financing process easier in the last six to eight months.

New investors Alta Partners and Clarus Ventures led the Series B round. Existing investors Sanderling Ventures and Tango/High Country Venture LLC, both of which contributed to Taligen's $3.75 million Series A round in mid-2006, also joined the Series B syndicate. (See BioWorld Today, Aug. 29, 2006.)

Clarus Managing Director Nicholas Galakatos pointed to Alexion Pharmaceuticals Inc. as an example of how a biotech can be successful with a single complement product.

Alexion's terminal complement blocker Soliris (eculizumab), which hit the market last April for the blood disorder paroxysmal nocturnal hemoglobinuria, generated $9.8 million in the second quarter and jumped to $21.8 million in the third quarter (full year numbers have not yet been reported).

The data linking complement to AMD "added a layer of excitement" to the complement story, Galakatos said.

Emlen declined to specify which of Taligen's preclinical products will advance into the clinic and when, but he noted the company has generated "a large amount of preclinical proof-of-concept data in a number of disease indications."

One of the possibilities is TA106, a monoclonal antibody fragment that inhibits Complement Factor B protein. Taligen is developing an inhaled formulation of the drug for severe asthma.

While the market for mild-to-moderate asthma is highly competitive, with established big pharma brands battling a growing number of over-the-counter and generic drugs, the options are far fewer for the 10 percent to 15 percent of asthma patients with severe disease. Severe asthmatics are often treated with high-dose corticosteroids, although the Immunoglobulin E (IgE) targeted monoclonal antibody Xolair (omalizumab, Genentech Inc. and Novartis AG) is also an option.

Galakatos pointed to a few advantages TA106 may have over Xolair, which generated $472 million in 2007.

TA106's inhaled formulation may provide a "faster onset of action" than Xolair injections, he said, and its local rather than systemic delivery may offer safety benefits. Additionally, Galakatos noted that the "response rate is not great for Xolair," while TA106 works farther up the inflammatory cascade.

Taligen also is developing an intraocular injectable formulation of TA106, which could be positioned for the AMD market. Another option is TT30, Taligen's drug targeted to Complement Factor H protein. Emlen said the company is still "evaluating which compound and route of administration is the best way to move forward" in AMD.

AMD affects more than 50 million people worldwide. About 10 percent of them have wet AMD, a market dominated by the vascular endothelial growth factor (VEGF) inhibitor Lucentis (ranibizumab, Genentech Inc.), which generated $815 million in 2007. Up-and-coming competitors in the wet AMD space include Regeneron Pharmaceuticals Inc.'s Phase III drug VEGF Trap-Eye and Opko Health Inc.'s Phase III drug bevasiranib, among others.

There are no drugs approved for dry AMD, the less serious though far more prevalent form of the disease.

Emlen said complement inhibition represents an alternative approach to Lucentis' VEGF targeting, potentially offering synergies or better serving a different subset of patients.

Other complement drugs in preclinical for AMD include Ophthotech Corp.'s aptamer targeting complement C5 and Optherion Inc.'s recombinant Complement Factor H protein.

In addition to asthma and AMD, the complement system plays a role in rheumatoid arthritis, immune renal disease and other inflammatory disorders.