West Coast Editor
About a week after submitting to the FDA an investigational new drug application for DG051, its drug for preventing heart attacks, DeCode Genetics Inc. is raising $30 million through a stock sale to several new and existing institutional investors.
Net proceeds of the sale, expected to close on or about tomorrow, are expected to total about $27.8 million, and Reykjavik, Iceland-based DeCode plans to use the proceeds for clinical trials, genotyping and general corporate purposes.
The firm expects to begin Phase I testing later this summer with the heart attack drug, a small-molecule inhibitor of leukotriene A4 hydrolase. It's a follow-on compound to DG031, in pivotal Phase III trials for heart attack prevention.
The trials with DG031, which began enrolling in May, are testing whether the compound will benefit African-American patients who carry the HapK haplotype in LTA4H and have been to the hospital for unstable angina or myocardial infarction.
Licensed from Leverkusen, Germany-based Bayer Healthcare AG, DG031 (for which patents expire in 2009 and 2012) is one of three compounds DeCode has in trials. In early 2006, the company wrapped up the Phase I program for DG041, a therapy for peripheral arterial disease. The program showed DG041 to be a well-tolerated inhibitor of platelet aggregation without increasing bleeding time, and DeCode began enrolling patients for a Phase II trial in June.
In asthma, the company has completed a Phase IIa trial in collaboration with Cephalon Inc., of Frazer, Pa., for CEP1347, a compound that targets a gene isolated by DeCode that is said to play an important role in a biological pathway involved in developing asthma. DeCode said in its prospectus related to the latest stock sale that CEP1347 "positively affect[ed] this pathway in a safe and well-tolerated manner" and Cephalon is "reviewing the data in order to determine whether to proceed with additional trials."
As of March 31, DeCode had about $140.2 million in cash, cash equivalents and investments. Lehman Brothers Inc., of New York, served as the lead placement agent for the stock sale and Thomas Weisel Partners LLC, also of New York, served as co-placement agent.
In other financing news:
• Metabolix Inc., of Cambridge, Mass., filed to raise up to $86.25 million in an initial public offering. Metabolix is focused on developing "environmentally sustainable, economically attractive alternatives to petrochemical-based plastics, fuels and chemicals," it said in its prospectus. The company's first platform, partnered with Archer Daniels Midland Co., of Decatur, Ill., is a large-scale microbial fermentation system for producing a family of naturally occurring polymers known as polyhydroxyalkanoates, which Metabolix calls PHA Natural Plastics. A second, early stage platform is a biomass biorefinery system using switchgrass to co-produce both PHA Natural Plastics and biomass feedstock for making ethanol. Within four years, the firm hopes to have commercially viable switchgrass varieties in pilot field trials, and to establish strategic alliances to commercially exploit the platform. New York underwriters Piper Jaffray Jefferies & Co., Thomas Weisel Partners LLC and Ardour Capital Investments LLC are handling the IPO.