Staff Writer

With positive Phase II data from its two lead liver programs in hand, Intercept Pharmaceuticals Inc. raised $25 million in Series B funding from Italian holding company Genextra SpA.

Genextra has been Intercept's primary backer to date, previously investing $4.5 million in seed financing and leading a $45.5 million Series A round, which also included participation by Balyasny Asset Management/Visium Capital and JAFCO Life Science Investment. (See BioWorld Today, May 17, 2006, and July 30, 2008.)

Mark Pruzanski, president and CEO of Intercept, said the support of a committed investor like Genextra is "a great thing to have," particularly when many venture firms have spent the last year culling their portfolios. Genextra's deep pockets, however, are only open for Italian life science companies - Intercept, although based in New York, was founded on intellectual property out of Italy's University of Perugia.

But geography aside, Pruzanski said there's only one way to attract a committed investor like Genextra: "You have to get results." And results are one thing Intercept has no shortage of these days.

Last October, the biotech reported positive Phase II data from a double-blind, placebo-controlled, 165-patient Phase II trial of INT-747 for primary biliary cirrhosis (PBC). INT-747, a first-in-class small-molecule farnesoid X receptor (FXR) agonist, significantly reduced alkaline phosphatase levels at all three doses tested in PBC patients who failed treatment with the FDA-approved drug URSO (ursodiol tablets, Axcan Pharma Inc.).

PBC is a chronic autoimmune liver disease reported to affect up to 40 in every 100,000 Americans. Ursodiol formulations like URSO are the only approved treatment, but Pruzanski said about half of those patients do not respond adequately, and are then at risk of progressing to end-stage liver disease.

Despite the unmet need and a global market that could be worth $250 million to $300 million, Intercept is the only company developing a new chemical entity for PBC, as far as Pruzanski is aware.

With Phase II data in hand, Intercept is preparing to request an end-of-Phase-II meeting with the FDA and scale up manufacturing for a pivotal Phase III trial. Pruzanski said he anticipates that the design of the Phase III study "will look a lot like the Phase II," and he is hopeful that only one pivotal trial may be required, given the orphan indication and extensive Phase II program (a second Phase II monotherapy study in PBC is slated to deliver data at the end of this year).

Beyond PBC, Intercept also is evaluating INT-747 for other chronic liver diseases. A few weeks before getting its positive PBC data, the biotech got positive data from a double-blind, placebo-controlled Phase II trial of the drug in Type II diabetic patients with nonalcoholic fatty liver disease (NAFLD).

The drug significantly improved glucose disposal rate, and patients experienced significant weight loss and improved biochemical markers of liver function.

NAFLD is rapidly becoming the leading cause of liver cirrhosis in the West, due to a rise in obesity rates, and there are no FDA-approved drugs to treat it, although Sucampo Pharmaceuticals Inc. and others have programs in the clinic. But Pruzanski said Intercept is still deciding whether to prioritize NAFLD or another liver disease as the next indication for INT-747.

Another option could be portal hypertension, which Pruzanski called "the primary cause of morbidity and mortality in patients with chronic liver disease."

The condition occurs when liver cirrhosis backs up blood flow, and Pruzanski noted that it is common in liver disease caused by fat (like NAFLD), autoimmune issues (like PBC) or viruses (like hepatitis C). Preclinical data presented last year indicated INT-747's promise in reversing portal hypertension.

Behind INT-747, Intercept is developing INT-777, a TGR5 agonist that induces the release of GLP-1 in the gut and normalizes glucose tolerance, making it applicable for diabetes and obesity. Intercept intends to file a new drug application in the third quarter.

Also in preclinical is INT-767, a dual FXR and TGR5 agonist. Pruzanski added that the company has a number of backup and follow-on compounds targeting FXR, TGR5 and other bile acid receptors.

Pruzanski declined to specify how long the Series B financing would last, noting that the runway will depend on partnering discussions, which are ongoing.

In other financing news:

• Cantab Pharmaceuticals plc, of Cambridge, UK, received a three-year, £5 million (US$8.1 million) investment from Celtic Pharma Holdings Advisors LLP. Cantab, which makes improved biologics and is headed into the clinic with a hematology product, is wholly owned by Celtic. Jim Mills, former director of operations at Cambridge Biomanufacturing Ltd., was appointed as Cantab's CEO.