Assistant Managing Editor

PhaseRx Inc., a young Seattle biotech firm founded to develop polymer-based technology for delivering short interfering RNA drugs, recently got its first major cash infusion, closing a $19 million Series A round.

That funding will come in two tranches, with $4 million in an up-front investment and the remaining $15 million to be paid upon the achievement of "a mix of business and research milestones," said company founder Robert Overell. The initial $4 million will "help us meet those milestones, so we're very focused on that right now."

Formerly a partner at Frazier Healthcare Ventures, Overell now heads Foundation BioVentures in Seattle, an organization that aims to help start-up biotechs develop business strategies and seek fundraising.

"I left Frazier in 2005 with an urge to do earlier-stage" ventures, Overell said, adding that "there are a lot of very interesting opportunities" involving programs that have yet to reach the clinic.

"Look at Glycofi [Inc.] and other companies with early stage programs that are getting bought for hundreds of millions," he added, referring to Lebanon, N.H.-based Glycofi, which was founded in 2000 to develop its yeast glycoengineering platform and acquired by Whitehouse Station, N.J.-based Merck & Co. Inc. in 2006 for $400 million.

With those early stage prospects in mind, Overell, along with Patrick Stayton and Allan Hoffman, both of the University of Washington's department of bioengineering, as well as Oliver Press, of the Fred Hutchinson Cancer Research Center, and Paul H. Johnson, the company's chief scientific officer, created PhaseRx, which began its corporate existence in 2006 with the licensing of a polymer technology from Stayton's and Hoffman's laboratories at UW.

That technology is designed to tackle the difficulties of delivering siRNA drugs. It uses "a new type of polymer that has multiple values attributed to it," Overell told BioWorld Today. Though he was reluctant to disclose the specific mechanism, he said the delivery platform "can target to specific cells and has a series of other desirable properties."

Historically, siRNA has presented challenges to researchers, given the difficulties in getting siRNA drugs to specific tissues and delivering them intracellularly. So it wasn't surprising that the UW technology sparked Overell's interest.

With siRNA delivery technology there is tremendous opportunity, he said, and "if you can get data in primates, people get very excited."

Work at PhaseRx is still in its early steps, though the company of three employees plans to develop its own therapeutic pipeline. For now, though, those programs are in preclinical development in undisclosed disease areas.

Partnership plans, too, are down the road, Overell said. "When we pull down that $15 million, we'll likely consider partnerships then."

In the meantime, he added, "We've got a lot of work to do."

PhaseRx's financing was led by ARCH Venture Partners, 5AM Ventures and Versant Ventures. Steven Gillis, of ARCH, was appointed company chairman, and John Diekman, of 5AM, and Brian Atwood, of Versant, both were named to the board.