BioWorld International Correspondent
LONDON - Alizyme plc was forced to go back to the market to raise £14.5 million (US$28.7 million) in a placing with its leading institutional investors, after failing to secure a promised deal for its lead product, Cetilistat, in obesity.
At the same time, founding CEO Richard Palmer resigned from the company, to be replaced by co-founder Tim McCarthy, who stepped up from the post of chief financial officer.
The placing was at 80 pence per share, a 5 percent premium. The share price has drifted down from a high of £1.94 in March, but with funding now assured until the end of 2008, investors jumped back in, and the share price rose 11.25 pence to 87.5 when the placing was announced Dec. 1.
McCarthy told an analysts' meeting in London that the new money would enable the Cambridge-based company to accelerate its commercialization efforts. "As a board, we realize there are expectations on commercialization. We've taken a hard look at ourselves and said we will focus on that."
One step in doing that will be a closer alliance with Novaquest, the partnering arm of the contract research organization Quintiles Transnational, which is an equity investor in Alizyme. Currently, Quintiles is carrying out the U.S. Phase III trial of another Alizyme product, Renzapride, for treating irritable bowel syndrome, and McCarthy said that the closer relationship "will enable us to be more innovative in how we approach partnering."
Some of the new money will be used to boost recruitment into the Renzapride trial and to the Phase III trial of Colal-Pred in ulcerative colitis. The company had expected results from those two trials in mid-2007, but recruitment has been slower than anticipated. With accelerated recruitment, results are expected around the end of 2007.
On Cetilistat, a lipase inhibitor, McCarthy said the aim now is, "To make sure the product is absolutely ready for someone to pick up from us next year." The company is currently in the final negotiations with the FDA on the design of the trial.
Alizyme has another product, ATL-104 for mucositis, that currently is languishing for want of development funds after completing Phase IIa trials. While there is not enough funding to move into the next phase of development, there will be work to ensure the product is ready to progress, and McCarthy said he is open to partnering offers.
McCarthy uncoupled Palmer's departure from the delay in finding a partner for Cetilistat, saying Palmer had approached the board a little while ago to say he was considering stepping down. "Unfortunately from our point of view, he decided to go ahead. It's a great shame: I have worked with him for the past 10 years, and he has delivered a fantastic portfolio for us that is unequalled in our sector."
Palmer held the combined role of CEO and R&D director, and a new head of R&D, Roger Hickling, has been appointed. "This is the first time in the company's history that R&D and CEO are in separate hands, so this means my focus can be entirely on commercialization," McCarthy said.
McCarthy is not starting from scratch to find a partner for Cetilistat, as term sheets have been put forward. "Discussions are ongoing, but we need to pick up momentum," he said. "There is a demand pull from pharmacy for products, but at the same time, [they] don't pick them up overnight."
One factor that has slowed negotiations has been the uncertainty in the obesity field, particularly around Acomplia (rimonabant), a cannabinoid Type I anti-obesity treatment from Sanofi-Aventis SA. The drug was launched in Europe in June, but still is awaiting the FDA's verdict. However, McCarthy said the market has moved on.
"My personal opinion is that there is recognition of the differentiation of Cetilistat in mode of action, safety, profile and therapeutic index," he said.