Preparing to move its first two products into the clinic, Phenomix Corp. closed a $40 million Series B financing.
The privately held San Diego company has raised a total of $65.5 million since it was incorporated in 2002 based on a technology platform using whole mammalian systems to find drug discovery targets. Phenomix, which has been building a pipeline of drugs to treat metabolic syndromes and immune diseases, has lead preclinical programs in diabetes and rheumatoid arthritis.
"We're really excited about this [financing] because we're going to use the proceeds to drive our programs into the clinic," said Laura Shawver, president and CEO of Phenomix, adding that she expects the funds to take the diabetes drug candidate, a DPP IV inhibitor designated as PHX1149, through Phase II studies. PHX1149 is designed as a once-daily, orally administered drug to prevent an increase in glucose levels and slowing the progression of insulin resistance that can occur in diabetic patients.
DPP IV is a "very popular target these days, and for good reason," Shawver told BioWorld Today. "It's been shown to affect a number of diabetic parameters."
Other companies likely would agree, such as San Diego-based Syrrx Inc. and Wilmington, N.C.-based PPD Inc., which submitted an investigational new drug application in December for SYR619, a compound targeting DPP IV, and Cambridge, Mass.-based Alantos Pharmaceuticals Holdings Inc., which in March was close to selecting a candidate from its own DPP IV program to move into the clinic. (See BioWorld Today, March 10, 2005.)
Phenomix's candidate is expected to enter Phase I trials this fall, and Shawver said investigators would be looking for more than just safety and tolerability data.
"Because we're taking blood for pharmacokinetic samples, we'll also be measuring enzyme inhibition," she said, to show whether the drug has an effect on the DPP IV target and if it demonstrates biological results such as the lowering of plasma glucose levels.
The company anticipates taking PHX1149 through Phase II development before seeking a late-stage development and commercialization partner.
By the end of the year, Phenomix plans to initiate clinical trials for its second product, PLX647, in rheumatoid arthritis. Shawver described that program as an "oral Enbrel," referring to Thousand Oaks, Calif.-based Amgen Inc.'s blockbuster TNF-alpha inhibitor. The drug is a small-molecule dual-kinase inhibitor that targets TNF-alpha released by macrophages and mast cells. But, unlike Enbrel or TNF-alpha inhibitor Remicade, from Malvern, Pa.-based Centocor Inc., Phenomix's drug could be delivered orally.
PLX647 was selected from a discovery collaboration with Berkeley, Calif.-based Plexxikon Inc. Once the product begins progressing through the clinic, the companies intend to seek a licensing partner for further development and commercialization, Shawver said.
Behind the two lead products, the company has several earlier-stage programs, all based on a platform technology that "allows us to parachute into the causative drivers of the disease," she said.
Phenomix's technology relies on "whole animal" pharmacology, using a mammalian system throughout the discovery and development process to identify the safest and most efficacious compounds. That early pharmacology work also guides clinical trial design.
"We try to achieve proof of concept early, to show that the drug hits the target and has a biological consequence at a particular dosage regimen," Shawver said.
Often referred to as the "forward genetics" approach, the platform can indicate a compound's safety profile during preclinical development, and "with the FDA paying so much attention to safety parameters, by using this platform technology, we can understand safety early in the process," she said.
Phenomix's technology helped land it a multiyear collaboration with South San Francisco-based Genentech Inc. to identify and prioritize drug targets for immune disorders. Through that agreement, Phenomix received an up-front payment as well as research funding, and is entitled to milestone payments on products. (See BioWorld Today, July 13, 2004.)
The company has about 50 employees and a facility in Canberra, Australia, which is affiliated with Australian National University. Baylor College of Medicine in Houston and the Genomics Institute of the Novartis Research Foundation in San Diego, along with the Australian National University, provided the technology that formed the basis for Phenomix.
The company's Series B was co-led by new investors JPMorgan Partners and Delphi Ventures, both of San Francisco. A third firm, New York-based Baker Brothers Investments, also participated in the round, joining existing investors Alta Partners, Sofinnova Ventures, Bay City Capital and CMEA Ventures, all of San Francisco, as well as Basel, Switzerland-based Novartis BioVenture Fund and Melbourne, Australia-based GBS Venture Partners.
Phenomix named Srinivas Akkaraju from JPMorgan Partners and Deepa Pakianathan, of Delphi Ventures, to the company's board.