BioWorld International Correspondent

BioTie Therapies Oyj packed three significant pieces of good news into less than a week, sending its shares upward and adding to its reserves about €35 million (US$46.1 million) cash, with the promise of more to come.

Its shares first moved Friday, when it disclosed that F. Hoffmann-La Roche Ltd. was paying a €5 million option fee in return for the right to obtain an exclusive license for its preclinical program to develop a fully human monoclonal antibody to vascular adhesion protein-1 (VAP-1), a target with dual functions in inflammation.

On Monday, the Turku, Finland-based company disclosed that it was obtaining €10 million on signing a licensing deal with Copenhagen, Denmark-based H. Lundbeck A/S in return for marketing rights to its opioid receptor antagonist nalmefene, which is in development for treating substance abuse and pathological gambling disorders.

On Tuesday, the company priced a new share issue, which, following the recent movements in its share price, is very heavily discounted. That will yield a guaranteed €13 million from institutional investors, including Westport, Conn.-based Pequot Capital, as well as local investors Dreadnought Finance Oy, Thominvest Oy and SITRA. Retail investors could take up €7.5 million more worth of shares when the placing is open to them Dec. 4.

The company is issuing up to about 40.2 million shares in total, priced at €0.51 per share. The offer is one of the most generous available to biotechnology investors in Europe this year. It was originally priced at a discount of around 20 percent, when BioTie's shares were changing hands at around €0.70. The stock peaked at €2.39 Tuesday but settled back to €2.03 by late afternoon trading on the Helsinki Stock Exchange.

As well as improving its cash position, the company had wanted to internationalize its investor base, BioTie CEO and president Timo Veromaa told BioWorld International. "I think we're the first in Finland to have significant funding from the U.S.," he said.

The promised influx of cash gave the company more room to maneuver and enabled it to complete its new deals. "We were really in a tight situation and have been for the past three years," Veromaa said. "If you don't have any money, you don't have much of a negotiating position in commercial deals."

The company is due €5 million cash next year, when the licensing agreement with Lundbeck enters into force. There still are some "minor details" to be finalized, because the agreement was completed so quickly.

BioTie could receive another €73 million in regulatory and commercial milestones, as well as royalties on product sales from Lundbeck, which has rights to nalmefene in all territories apart from North America, Mexico, UK, Ireland, Turkey and South Korea.

Earlier this year, BioTie and its UK and Ireland partner, Redhill, UK-based Britannia Pharmaceuticals Ltd., submitted a marketing authorization application to the London-based Medicines and Healthcare Products Regulatory Agency (MHRA) for the use of nalmefene in alcoholism.

Lundbeck will pursue the same indication in other European territories, while its North American partner, San Diego-based Somaxon Pharmaceuticals Inc., is targeting pathological gambling addiction. A Phase II/III trial in that indication is due to be completed before the year-end.

The VAP-1 antibody option agreement with Basel, Switzerland-based Roche, which excludes Japan, Taiwan, Singapore, New Zealand and Australia, will terminate on completion of a Phase I trial. That study is due to commence early next year and should take about 12 months to complete. "They can continue the option by making an additional payment," Veromaa said.

The deal extends an existing agreement between the companies. Roche already has an exclusive option on BioTie's VAP-1 small-molecule inhibitor program, which is targeting a catalytic domain of VAP-1. That gives rise to a semicarbazide-sensitive amine oxidase (SSAO) enzymatic activity, which contributes to the production of pro-inflammatory mediators, including hydrogen peroxide.

The monoclonal antibody, which is based on HuMab technology licensed from Princeton, N.J.-based Medarex Inc., blocks leukocyte migration across vascular tissues by interfering with an endothelial cell adhesion function of VAP-1.