New Boston-based company Concert Pharmaceuticals Inc., focused on using advanced chemical methodology to create small-molecule drugs, raised $10 million in its first financing round.

Leading the company is Roger Tung, as president and CEO. He is a former executive at Cambridge, Mass.-based Vertex Pharmaceuticals Inc. and the inventor of that company's two marketed HIV protease inhibitors, Agenerase and Lexiva/Telzir.

Tung said the financing will accelerate Concert's ability to move its technologies into the drug discovery and development stage. "We have clearly attracted interest from some top-drawer investors," he told BioWorld Today, "and there's a degree of validation that goes along with that."

Three Arch Partners, of Portola Valley, Calif.; TVM Capital, of Boston; and based Skyline Ventures, of Palo Alto, Calif., co-led the Series A round, which included investments from Greylock Partners, of San Mateo, Calif., and QVT Fund LP, of New York. The funds should take Concert into late 2007 or early 2008 before it would need another financing.

"I think the interest that the investors had in Concert is they believe and we believe the approach that we have will streamline the process of discovering" new molecules, Tung said.

For competitive reasons, the company has not disclosed a great amount of detail about its technology, for which it is filing patent applications. Tung left Vertex, a company he co-founded in 1989, about a year and a half ago, at which time he served as vice president of drug discovery at the San Diego site. He then formed a consulting company and was doing work for biotech and pharmaceutical companies when he invented and developed the technologies that are now part of Concert's focus. Concert was incorporated in March.

"The conundrum right now in general with small-molecule research is it's very capital intensive, and it takes a long time and the discount rate is high. The likelihood of failure is very high," Tung said, explaining his motivation.

Studies, he said, have shown that while research and development expenditures have increased every year, "the rate of submissions and their approvals by the FDA is trending downward.

"That's not a great equation, frankly, for investors" or for the researchers and management working in the space, he added.

Concert's technology will help to discover drugs for a variety of indications, although "there are certain instances where we think the technology is more applicable than others," Tung said. The company, however, is not branding itself as an exclusively focused company. While it is considering various forms of administration for the small-molecule drugs that come out of its research, it has a keen interest on oral agents because that is where "the majority of the economics of small molecules" come from.

Concert expects to partner its initial products, like most young biotech companies do, but it has no interest in partnering the technology.

"I think it's unlikely we'll take our first product to the market by ourselves," Tung said, "but we reserve the right to reassess that as we move along."

He could not say when the company might have its first lead preclinical candidate.

With four full-time employees, Concert intends to grow to about 15 within its first year of operations. Working alongside Tung is Nancy Stuart as senior vice president of corporate strategy and operations. She formerly worked at Rockville, Md.-based RRD International LLC, a product development company that helps biotech firms move from preclinical development to the market. Before that, Stuart was at The Medicines Co., of Parsippany, N.J., and Vertex.

"The management that we've brought on board are industry veterans," Tung said. "These are people who have a long-term record of success."

Concert's board consists of chair Rich Aldrich, chairman of RA Capital Management LLC, of Boston; Wilf Jaeger, partner and founder of Three Arch Partners; Stephen Hoffman, general partner of TVM Capital; John Freund, managing director and founder of Skyline Ventures; Christoph Westphal, CEO and vice-chairman of Sirtris Pharmaceuticals Inc., of Cambridge, Mass.; and Tung.

"We've got great investors. I know a lot of companies will say that," Tung said, "but if you look at the track records of the investors we're working with in terms of getting their companies successfully moved forward to IPOs and to M&A endpoints, I think they've done very well."