Staff Writer

Vascular biology company TargeGen Inc. raised $30 million in its third private financing round for small-molecule kinase inhibitors to treat cardiovascular and wet age-related macular degeneration.

The Series C round was led by new investor BB Biotech Ventures, of Zurich, Switzerland, which was joined by H&Q Healthcare Capital Management, of Boston. As part of the financing agreement, Juerg Eckhardt, of BB Biotech, was appointed to TargeGen's board.

To date, the company has raised just more than $70 million, said Peter Ulrich, CEO of San Diego-based TargeGen. Its Series B raised $30 million in January 2004.

Proceeds "largely are going to be used to advance the pipeline going forward," Ulrich told BioWorld Today, adding that it "should give the company approximately two years" of operating capital.

TargeGen's most advanced product candidate, TG100-115, began clinical testing in January in a 100-patient Phase I/II trial in acute myocardial infarction. The intravenously administered drug is a selective P13-kinase inhibitor designed to reduce the infarct size and reperfusion by acting on two mechanisms, Ulrich said.

First, it is directed to target edema, or vascular leakage, which contributes to the infarct size, and then it aims to reduce inflammation related to reperfusion injury, thereby preserving heart muscle tissue, he said.

Following that product is TG100801, which Ulrich called "arguably TargeGen's most exciting drug candidate."

In preclinical development as a topically administered eyedrop, TG100801 is a multi-target kinase inhibitor designed to treat macular degeneration, as well as diabetic macular edema and diabetic retinopathy, by simultaneously targeting three mechanisms of action: edema, angiogenesis and inflammation.

"We believe it's the first non-invasive product to potentially treat macular degeneration," Ulrich said. "The products currently available for wet AMD require intravitreal injections, and act singularly on the VEGF mechanism."

He's referring to New York-based Eyetech Inc.'s Macugen (pegaptanib sodium injection), a VEGF inhibitor approved for wet AMD late last year. Other drugs in development, such as Lucentis by South San Francisco-based Genentech Inc., also target the vascular endothelial growth factor (VEGF).

However, Ulrich said, the disease is "more complicated than just the VEGF-mediated retinal leakage."

TargeGen's compound was "designed with a broader mechanism of action," he added. "It's the first compound we're aware of that is able to penetrate the surface of the eye and to achieve sufficient intraocular concentrations in the retinal and choroidal regions of the eye."

The company anticipates completing long-term toxicology studies and filing an investigational new drug application for TG100801 in mid-2006.

Behind those products, TargeGen has a preclinical program in oncology, starting with TG100-435, an oral drug aimed at treating solid tumors, specifically non-small-cell lung cancer and colorectal cancer. A second drug, TG100-572, targets chronic myelogous leukemia that is resistant to Gleevec (imatinib, by Novartis AG) due to ABL mutations.

All of TargeGen's drug candidates have come from its own in-house discovery efforts, Ulrich said.

TargeGen was formed in 2001 within San Diego venture capital firm Forward Ventures, as part of the entrepreneur-in-resident program. The company moved out on its own in 2002 after its $10 million Series A round.

Forward Ventures also invested in the Series C round, along with La Jolla, Calif.-based Enterprise Partners; Chicago-based William Blair Capital Partners/Chicago Growth Partners; Montreal-based CDP Capital Technology Ventures/VantagePoint Venture Partners; Taiwan-based China Development Industrial Bank; and Research Triangle Park, N.C.-based A.M. Pappas & Associates.