West Coast Editor

Taking aim at access sites in dialysis patients and at peripheral arterial disease (PAD) with its vascular remodeling weaponry, Proteon Therapeutics Inc. raised $12 million, adding to the $19 million of Series A funds raised last spring and providing the privately held firm with enough cash to put the lead product, PRT-201, into the clinic early next year.

Timothy Noyes, Proteon's president and CEO, called dialysis "a prudent place to start," and said the firm is still debating when PAD trials might begin.

"We probably wouldn't wait much longer than the end of our first-in-man [dialysis] trial to start our first PAD trial," he said. "It's possible we could start them in a slightly more staggered way." The vasodilator protein PRT-201 can be applied topically to the external surface of exposed vessels during surgery, or injected through angioplasty catheters.

Dialysis sites are made two ways. In arteriovenous fistulas (AVFs), the vein is surgically sewn directly to the artery. In arteriovenous grafts (AVGs), the artery and vein are connected by way of a segment of artificial tubing.

AVFs "often don't work, but once they do, they work for a long time and they work great," Noyes said. "The graft is pretty well the opposite. Half of the grafts have failed in seven to nine months, and patients undergo a series of re-works," such as angioplasties that require hospital stays.

"Very few people have done anything in fistulas," he said. "Most of the attention has been on the graft side" since, in the U.S., more grafts than fistulas are used. Still, in dialysis access, science has made "no meaningful advances since anybody can remember," he added. "Everybody's talking about trying to improve dialysis, but you can't do that until you improve access."

If PRT-201 works, it will have the advantage of being entirely local. "It's one-time, it's fast and persistent, and we believe it's going to be safe," Noyes said, noting that the protein does not preclude other approaches used in tandem, as opposed to such approaches as stents.

Last month, Pervasis Therapeutics Inc., of Cambridge, Mass., finished patient recruitment for its two Phase II trials of Vascugel, an allogeneic cell therapy product to restore natural repair and regeneration pathways in traumatized vasculature.

"They're looking at a very different approach, but they're also looking at fistulas and grafts," Noyes said. Other companies, such as Vancouver, British Columbia-based Angiotech Pharmaceuticals Inc., are exploring whether methods used against coronary artery disease might be used in dialysis, he noted, but "the jury's out right now."

Testing PRT-201 in dialysis access and PAD gives Proteon "at least three, unique distinct patient types to figure out where this protein works best," he said. Which indication will turn out the most lucrative, Noyes added, is not easy. Although PAD seems like the obvious answer, the number of patients on dialysis "continues to grow so fast that it's probably a toss-up," he said.

Plenty of other firms are working to find therapies for PAD, which afflicts as many as 8 million Americans and causes such conditions as intermittent claudication, or pain while walking, caused by occluded blood flow. The only U.S.-approved drug for claudication is Pletal (cilostazol, Otsuka America Pharmaceutical Inc.), a phosphodiesterase III inhibitor that can't be used in patients with congestive heart failure.

In June, New York-based Indigo Pharmaceuticals Inc. licensed rights to INDI-702 (previously NM-702), an oral compound that inhibits PDE-3 and thromboxane A2 synthetase, from Nissan Chemical Industries Ltd. and Taisho Pharmaceutical Co. Ltd., with Phase III trials in claudication planned for the first half of next year.

About a year ago, Burlingame, Calif.-based Valentis Inc. chalked up one of a handful of failures in PAD with the poloxamer VLTS 934, scrapped by Valentis after a Phase IIb failure. The firm's stock was hit hard by the news, and this year changed its name to Urigen Pharmaceuticals Inc. after reverse merger with the specialty pharma company Urigen NA Inc. (See BioWorld Today, Oct. 10, 2006, and July 12, 2006.)

Noyes said efforts to treat PAD, "although they're very good at restoring blood flow, they also to some extent cause damage," as would any device that's interacting with the endothelium. "You hope that, on net, it comes out to be a benefit," he said.

With PRT-201, "we're not doing anything to the endothelium - we're not disrupting it, we're not damaging it," he said.

With dialysis and with PAD, "the underlying pathophysiology is complex," Noyes said. "It's probably going to require more than one solution. I don't think there's any silver bullet here," but Proteon hopes PRT-201 will prove benign enough to serve as part of therapies. Noyes said the company, with the new cash, has enough to operate through the end of next year.

In other financing news:

• Antigenics Inc., of New York, entered into an agreement with Fletcher Asset Management to sell $5 million of common stock. Antigenics is offering about 1.6 million shares at $3.08 per share, a 24 percent premium above the closing price on August 31, 2007, and expects to net about $4.7 million. Antigenics is also offering shares of its Series B1 and Series B2 convertible preferred stock to Fletcher. Antigenics' stock (NASDAQ:AGEN) closed Thursday at $2.34, unchanged.

• Cyntellect Inc., of San Diego, completed a $3 million second closing on its Series D preferred private financing which follows the initial Series D closing of about $15 million on July 25. Investors may commit up to $10.3 million more.

• Bioheart Inc., of Sunrise, Fla., set terms for its proposed initial public offering. The company plans to sell 3.575 million shares at $14 to $16 per share, an offering that would raise about $53.6 million at the midrange of that estimate. The company's lead product is MyoCell, an autologous cell-based therapy for treating heart failure. It registered for the IPO in February. (Se BioWorld Today, Feb. 15, 2007.)

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