Partnered with Adimab LLC for antibody development in dementia and Alzheimer’s disease (AD), Alector LLC raised an undisclosed amount of money in its Series A round, enough to last “two or three years, we think,” said CEO Arnon Rosenthal, who estimated “at least four years before we are in the clinic” with a drug that might succeed where so many others have not.
AlectorAdimab, of Lebanon, N.H., this summer also disclosed antibody platform deals with Summit, N.J.-based Celgene Corp. and Innovent Biologics Inc., of Suzhou, China. (See BioWorld Today, Aug. 21, 2013.)
Developers have had problems conquering AD for “multiple reasons,” Rosenthal said. “A significant challenge is the clinical trials, because the disease progresses very slowly, and many of the clinical endpoints are very subjective.”
Large patient populations must be tested over long periods of time, so failures show up slowly. Also, “the knowledge of the disease is just evolving,” and most work has been based on the familial form of AD, which makes up a small portion of cases, Rosenthal said.
“The [attempts at] disease-modifying therapies were focused on A-beta [the protein whose faulty processing appears to underlie the familial form of AD],” but developers need to cast their nets wider, he said. “Either A-beta is not the only or the main cause of the sporadic form [of AD], or A-beta is sufficient to initiate the disease but not to propagate it. You need alternative approaches.”
Treating AD as early as possible may sound like a good idea, but is impractical at this point, he said. “Basically, people can detect nonclinical symptoms 10 or even 25 years before you see clinical symptoms, so I don’t think it’s realistic to treat it early,” Rosenthal told BioWorld Today. “This argument is primarily based on experiences with A-beta therapy, the passive and active immunization for A-beta.”
More accurate may be the “trigger” hypothesis, he said, which holds that A-beta, also known as amyloid-beta, “starts the disease very early, but once the trigger is pulled, there are downstream [effects] which are self-sustaining and no longer call for A-beta.”
Clinical research is “significantly improving with imaging tools and biomarkers,” Rosenthal said. “The disease is so devastating that one cannot give up, despite the failures.”
Alector, with 12 employees, was funded and started operating earlier this month, and was incorporated in May. The name of the company derives from Greek mythology, where it’s associated with several figures, and the founders of the company regard the word as embodying a reality-based philosophy.
The Series A financing was led by Polaris Venture Partners and Orbimed Advisors. General partners Terry McGuire from Polaris and Carl Gordon from Orbimed joined Alector’s board.
In other financing news:
• Discovery Laboratories Inc., of Warrington, Pa., priced an underwritten public offering of 25 million shares of its common stock, at a price to the public of $2 per share for gross proceeds of $50 million. Net proceeds are expected to be approximately $47 million, and the offering is expected to close on or about Nov. 5. The underwriters have been granted a 30-day option to purchase up to an additional 3.75 million shares of common stock to cover overallotments. Stifel and Piper Jaffray & Co. are acting as joint bookrunning managers, with Lazard Capital Markets LLC acting as co-lead manager and Roth Capital Partners LLC serving as co-manager.
• Globeimmune Inc., of Louisville, Colo., cited unfavorable market conditions as it withdrew its planned initial public offering, through which the company had intended to raise $60 million. Wells Fargo Securities and Piper Jaffray & Co. would have been bookrunners on the deal. (See BioWorld Today, July 5, 2012.)
• Hatchtech Pty. Ltd., of Melbourne, Australia, completed a financing of A$12.6 million (US$11.9 million). The financing was led by Oneventures Innovation Fund and supported by a number of the company’s other existing investors, including the University of Melbourne, the Queensland Biotechnology Fund and Uniseed. New investors included a number of private sophisticated investors and the Brisbane, Australia-based Blue Sky Alternative Investments, marking one of its first investments in the biotechnology sector. The proceeds will fund the final stages of development of Hatchtech’s head lice treatment, Deovo, including a Phase III trial, and the funding is expected to see the company through to submission of a new drug application with the FDA in the second half of 2014.
• Lion Biotechnologies Inc., of Los Angeles, entered definitive agreements with institutional and other accredited investors to raise about $23 million in a private financing. Subscribers have agreed to purchase units consisting of either one share of common stock and a warrant to purchase a share of common stock, or one share of the newly authorized Series A convertible preferred stock (CPS) plus a warrant to purchase the number of shares of common stock, initially issuable upon the conversion of the preferred stock. The shares of common stock (and accompanying warrants) will be sold at $2 per share, and the shares of Series A CPS (and accompanying warrants) will be sold at $1,000 per share. The shares of Series A CPS will have a stated value of $1 ,000 per share and initially will be convertible into shares of common stock at a price of $2 per share (subject to customary adjustment for stock splits, reorganizations, and similar changes). Each warrant entitles the holder to acquire one share of common stock at a price of $2.50 for a period of five years from the closing. Lion expects to receive net proceeds of about $21.6 million. The offering is expected to close on or about Nov. 4, 2013.
• Novaquest Capital Management LLC, of Raleigh, N.C., closed Novaquest Pharma Opportunities Fund III LP, a $459 million private equity fund focused on providing structured finance solutions to biopharmaceutical companies. The Novaquest management team said it “seeks to continue its strategy of earning product-based returns from late-stage and commercial products” with the new fund.