Assistant Managing Editor

Drug delivery firm Expression Genetics closed a $12 million Series B round led by venture capital and private investors to boost work on its lead program, an ovarian cancer product in Phase Ia testing.

Incorporated in 2002, the Huntsville, Ala.-based company has raised about $27 million to date. Money from the latest round should last a "couple of years" and help advance EGEN-001, a product based on the firm's TheraPlas platform, which combines an interleukin-12 gene expression plasmid with a biocompatible delivery polymer, said CEO Danny Lewis.

It's "designed to boost an individual's own immune system," Lewis told BioWorld Today, and the delivery polymer is intended to increase the local concentration of IL-12, a well-known anticancer cytokine.

In 2006, Expression Genetics wrapped up an initial Phase I trial of EGEN-001 as a monotherapy in ovarian cancer patients, with "encouraging results," Lewis said.

The drug now is in a Phase Ia trial of the product in combination with standard chemotherapy. That study is expected to enroll up to 30 patients and will measure safety as the primary endpoint.

While EGEN-001's mechanism makes it a likely candidate for a number of other cancer indications, Expression Genetics decided to first tackle advanced recurrent ovarian cancer, a disease that has proved a tough nut to crack. Notable failures over the past couple of years include OvaRex, an immunotherapy from United Therapeutics Corp. and ViRexx Medical Corp., which missed its endpoints in two pivotal trials late last year, and London-based Antisoma plc's ASA404, a small-molecule vascular disrupting agent that crashed in a Phase II study in platinum-sensitive ovarian cancer.

The disease is considered an orphan indication - an estimated 22,000 new cases were diagnosed in the U.S. in 2007 - and is "the silent killer in women," Lewis said. "It's not usually detected until it's [progressed] to Stage III or Stage IV, and at that point, there's no treatment."

EGEN-001 has been designated an orphan drug by the FDA, and the agency's orphan division last year awarded Expression Genetics with a $1 million grant to support the drug's development in ovarian cancer.

Beyond that program, the company has conducted preclinical work in other indications, such as brain cancer, head and neck cancer and pancreatic cancer. In October, the firm received a $163,713 Small Business Innovation Research award to evaluate EGEN-001 in brain cancer.

The small biotech of 18 full-time employees also is working on a second technology platform, TheraSilence, which is designed to deliver therapeutic siRNA or shRNA. That program so far has yielded some early candidates that are being testing in animal models.

Lewis said Expression Genetics will focus its efforts through early clinical success but has no intention of heading to commercialization on its own. In fact, he said, "we're actively seeking a pharma partner this year for EGEN-001," as that drug approaches later-stage testing.

The latest financing will help expedite some of the company's early work, but Lewis said the firm is "always looking for additional funding" to accelerate its platform and pipeline development. "We'll probably open up a Series C in 2009," he said.

In other financings news:

• Aeolus Pharmaceuticals Inc., of Laguna Niguel, Calif., said it raised $500,000 through the sale of newly issued senior convertible notes and warrants to institutional investors. Those investors also committed to invest another $500,000 over the next four months and have the option to add an additional $4 million over the next 18 months. Aeolus intends to use the initial net proceeds to advance the development of AEOL 10150, a small-molecule catalytic antioxidant, and for general administrative expenses and working capital. Shares of Aeolus (OTC BB:AOLS) closed at 35 cents Monday, up 1 cent.

• EpiCept Corp., of Tarrytown, N.Y., priced a public offering of 5.5 million shares at 54 cents per share and five-year warrants to purchase up to 2.8 million shares at an exercise price of 48 cents each. Net proceeds are expected to total about $2.7 million, and the company intends to use funds to meet working capital needs and for general corporate purposes. Money also will be used to repay a portion of its senior secured loan. Rodman & Renshaw LLC acted as the exclusive placement agent. Shares of EpiCept (NASDAQ:EPCT) fell 5 cents Monday to close at 61 cents.

• Illumina Inc., of San Diego, is proposing a public offering of 3.5 million shares under an existing shelf registration statement. The company said it will grant underwriter Goldman, Sachs & Co. the right to purchase up to an additional 525,000 shares to cover overallotments. Illumina develops and markets next-generation tools for the large-scale analysis of genetic variation and function.