Two years after its launch by Seattle-based incubator Accelerator Corp., Allozyne Inc. is ready to move out on its own, thanks to a $30 million Series B round and the appointment of a new CEO.

The firm was founded in November 2005 based on technologies developed by David Tirrell and William Goddard at the California Institute of Technology that aim to improve protein-based therapeutics.

Allozyne's work focuses on the modifying proteins with non-natural amino acids, structures that are similar to those that occur naturally

"We can perform site-specific modification on proteins" to customize drugs for improved efficacy, tolerability and more convenient dosing schedules, said Meenu Chhabra, who recently joined Allozyne as president and CEO.

For its lead program, the company is developing a longer-acting version of interferon beta for multiple sclerosis patients that would be more convenient than the dosing schedules required by existing therapies. Betaseron (interferon beta-1b), from Berlex Laboratories Inc., (now a unit of Bayer HealthCare) is given subcutaneously every other day, and Rebif (interferon beta-1b) from Geneva-based Merck Serono SA, is administered subcutaneously three times per week. Cambridge, Mass.-based Biogen Idec Inc.'s Avonex (interferon beta-1b) is delivered in once-weekly intramuscular injections.

Companies "have tried to come up with a longer-acting version of interferon beta in the past, but have not been successful," Chhabra said. "We believe we will be able to [succeed] where others have failed" since Allozyne's technology can pegylate the interferon beta, which would allow the drug to "pass more slowly through the body" and have more time to be absorbed into the bloodstream.

Phase I trials are expected to start in 2009, but the company anticipates looking for a partner after obtaining additional data. It's already in "active discussions with the usual suspects in big pharma," Chhabra told BioWorld Today.

Beyond that program, the company anticipates using funds from the Series B to advance additional compounds into preclinical development.

To date, the Seattle-based firm has raised about $36.4 million, including $3.4 million from its launch from Accelerator, said Carl Weisman, president and CEO of Accelerator. Allozyne has 10 employees, though Chhabra aims to double that number by the end of next year.

"If we keep to the plan" to develop the long-acting interferon beta and pursue some additional programs, the firm should have enough cash to carry it until 2010, "with a little bit of a runway left," she said. "Of course, that's excluding any collaborations . . . we might sign along the way."

The Series B round was led by MPM Capital, of Boston, with participation from existing investors, including OVP Venture Partners, of Seattle; Amgen Ventures, of Thousand Oaks, Calif.; ARCH Venture Partners, of San Francisco; and Alexandria Real Estate Equities Inc., of Pasadena, Calif.

In other financings news:

• Avalon Pharmaceuticals Inc., of Germantown, Md., filed a $50 million shelf registration statement to sell, from time to time, stock, warrants and debt securities. Specific terms would be announced at the time of any offering. In its prospectus, Avalon said proceeds would be used to fund development of its product pipeline, including lead program AVN944, an IMPDH inhibitor in Phase II development, and preclinical programs targeting the beta-catenin and Aurora/centrasome pathways. The company's shares (NASDAQ:AVRX) closed at $5.12 Friday, down 31 cents.

• Bionovo Inc., of Emeryville, Calif., priced a public offering of 10 million shares at $2.50 each, plus 5 million warrants to purchase shares at $3.50 each at the price of 10 cents apiece, for net proceeds of about $24 million. BMO Capital Markets Corp. and Canaccord Adams Inc. acted as joint book-running managers, with Merriman Curhan Ford & Co. serving as co-manager. Shares of Bionovo (NASDAQ:BNVI) fell 23 percent, or 73 cents, Friday to close at $2.45.

• Sequenom Inc., of San Diego, is raising $30 million through the sale of about 3.4 million shares of common stock priced at $9 each. The company anticipates net proceeds to total about $28 million, which will be used to support research, development and commercialization of its diagnostic tests, as well as for general corporate purposes. Sequenom's focus is on genetic analysis products, including its MassARRAY system, a nucleic acid analysis platform that measures the amount of genetic target material. Lehman Brothers Inc. and UBS Investment Bank served as joint-lead placement agents, while Oppenheimer & Co., Leerink Swann LLC and Rodman & Renshaw LLC acted as co-placement agents. Shares of Sequenom (NASDAQ:SQNM) fell 47 cents Friday to close at $9.51.

• Protox Therapeutics Inc., of Vancouver, British Columbia, has received about $5.2 million of a potential $7.7 million from the exercise of warrants issued as a result of the two tranches of a private placement financing in November 2005. That brings the company's total cash position to slightly more than $10 million. Funds will be used to support development of the PRX302 in prostate cancer and benign prostatic hyperplasia and PRX321 in brain cancer. Protox anticipates starting multiple Phase II programs in 2008.