Privately held Horizon Therapeutics Inc. raised $30 million in venture capital, securing adequate funding to complete two ongoing Phase III studies of lead product HZT-501, an NSAID combined with a gastroprotective agent, in patients suffering mild to moderate pain.
Essex Woodlands Health Ventures, of Palo Alto, led the Series C round, with participation from existing investors Scale Venture Partners, of Foster City, Calif., Sutter Hill Ventures, also of Palo Alto, and Pequot Ventures, of New York. Horizon, which previously brought in $15 million in Series B round in the fall, has raised a total of $51 million to date.
The latest financing should "bring us through Phase III trials" with the HZT-501 and, pending positive data, a new drug application either at the end of 2008 or the start of 2009, said CEO George Tidmarsh.
Horizon, founded by Tidmarsh and Barry Golombik, who heads the company's business operations, aims to "bring to market GI-friendly, cardiovascular-friendly pain relief," Tidmarsh said, by creating NSAIDs (non-steroidal anti-inflammatory drugs) with a decreased risk of gastrointestinal side effects, without adding cardiovascular toxicity.
The company came on the scene in 2005, while the industry was reeling from the fall of the COX-2 inhibitors, such as Vioxx, which had been launched on the market a few years earlier as a safer NSAID. Because those drugs selectively targeted COX-2 - as opposed to agents such as ibuprofen and naproxen, which hit both COX-1 and COX-2 - they demonstrated a much safer GI profile. But further studies showed a link to increased cardiovascular symptoms. Vioxx, from Whitehouse Station, N.J.-based Merck & Co. Inc. was withdrawn from the market in 2004. Another COX-2 inhibitor, Bextra, from New York-based Pfizer Inc., was suspended from the market in 2005, and Celebrex, another Pfizer drug, continues to be sold, though it now contains a black-box warning.
After the cardiovascular safety issues around COX-2 inhibitors came to light, "physicians went back to prescribing ibuprofen," Tidmarsh said. "Unfortunately, patients were subjected to the risk of GI toxicity." NSAID-induced GI toxicity is estimated to account for about 16,000 deaths and more than 100,000 hospitalizations each year in the U.S.
Hoping the fill the void left by those products, Horizon focused on a way to "combine the most widely prescribed pain reliever, ibuprofen, with an agent known to reduce ulcers," Tidmarsh told BioWorld Today. The company's approach involves the formulation of ibuprofen with famotidine, an H2 receptor antagonist, into a single pill to create HZT-501. A previously completed a proof-of-concept study involving 285 arthritis patients, showed that the cumulative incidence of gastric ulcers was 20 percent in the NSAID-alone group and only 8 percent in the famotidine-plus-NSAID group, while the cumulative incidence of duodenal ulcers was 13 percent and 2 percent, respectively.
Horizon is looking to duplicate those results in its ongoing Phase III program, which is expected to enroll 600 patients each in two trials, with the primary endpoint defined as the reduction in the risk of ibuprofen-associated upper gastrointestinal ulcers. Patients in the studies will receive study medication for up to 24 weeks. The company expects to complete enrollment in 2008.
Because the company is working with two known agents, it was not required to conduct animal studies before starting Phase I testing. "Then, we moved fairly rapidly into Phase III," Tidmarsh said. All told, it took about 14 months from investigational new drug application filing to the start of pivotal testing.
Horizon also recently entered the clinic with a second product, HZT-602, a combination of famotidine and naproxen. The Series C financing is expected to fund that program to the start of Phase III, he said.
Because of the size of the pain market - about 100 million prescriptions for NSAIDs are written each year in the U.S. - the company expects to seek a partner to reach the primary care market "if the economics are right," though "there are opportunities, even for a small company, to market" the drugs, Tidmarsh said. Horizon intends to build its own sales force in the future.
For now, though, it remains small, with just five employees. Most of its work is done through contract researchers, though Tidmarsh anticipates adding some additional staff with the latest financing round.
The company is based in Palo Alto, Calif.
In other financings news:
• NeuroDerm Ltd., of Ofakim, Israel, raised $2.5 million in a Series A round. Investors included Robert Taub, founder and CEO of Omrix Biopharmaceuticals Inc., who along with Uwe Wascher, of Wascher & Partner, will join the company's board. Previous investors in the company include Ofakim High Tech Ventures and Shmuel Cabilly. NeuroDerm, which was founded in 2004, develops transdermal drugs for central nervous system diseases and its lead product, ND0601, is a skin patch for the continuous delivery of levodopa for Parkinson's disease.