TorreyPines Therapeutics Inc., formerly Neurogenetics Inc., raised $34.8 million in private financing to advance its lead compounds in migraine and Alzheimer's disease.
The company's Series C financing includes funding from four new investors, led by New Brunswick, N.J.-based Johnson & Johnson Development Corp. and Alta BioPharma Partners, a late-stage fund of San Francisco-based Alta Partners. NIF Ventures, of Palo Alto, Calif., and Sorrento Ventures, of San Diego, also invested.
The company also said it secured participation from existing shareholders, including another fund managed by Alta Partners; GIMV, of Antwerp, Belgium; Advent International, of Boston; Novartis Venture Fund, of San Diego; and S.R. One, of West Conshohocken, Pa.
Along with the financing, the company elected Roy Cosan, of Johnson & Johnson Development Corp., to its board.
"It's very exciting," said Craig Johnson, vice president of finance and chief financial officer of TorreyPines, adding that the proceeds will be used to "move all of our programs forward."
The company has two clinical-stage products: NGX424, a non-opioid, non-vascular compound licensed from Indianapolis-based Eli Lilly and Co., is in Phase I study for the treatment of acute migraine, and TorreyPines plans to file an investigational new drug application this spring for its NGX267 drug for Alzheimer's disease.
"We also have two [candidates] in preclinical development for those same indications, and two in discovery," Johnson said. One of the discovery programs is a genetic approach to treating Alzheimer's and the other is a small-molecule treatment for the disease that "we'll be pushing forward and hoping to partner to bring it into the clinic."
Since it was founded in 2000, the San Diego-based company has raised a total of $61.9 million, including the recent financing, which is expected to sustain the company "at least into next year," Johnson said, "though there are a lot of variables, such as products moving faster than expected."
He told BioWorld Today the company has no immediate plans to partner NGX424 or NGX267.
"We need to push those forward and get data, and that data will likely drive any decisions," he said.
TorreyPines changed its name partly because executives felt that the former designation limited the company to neurological areas and did not reflect its expanding product pipeline, Johnson said.
Named after the Torrey Pines region of San Diego, the company hopes to capitalize on the success of the surrounding business community.
"There are a lot of great companies in the Torrey Pines area, and we hope to become one of those," Johnson said.
TorreyPines, the company, has about 50 employees.
KaloBios Raises $20M Privately
Palo Alto, Calif.-based KaloBios Pharmaceuticals Inc., a therapeutic antibody company, completed a second round of financing, raising $20 million to build a clinical development team and move two lead antibodies into human trials.
The Series B round was led by Boston-based MPM Capital and Melbourne, Australia-based GBS Venture Partners, and also included Hong Kong-based Lotus Bioscience Ventures, as well existing investors San Francisco-based Sofinnova Ventures; Palo Alto, Calif.-based Alloy Ventures; Menlo Park, Calif.-based 5AM Ventures; and Singapore BioInnovations Pte. Ltd., of Singapore.
The company also announced two new members to its board: Dennis Henner, a general partner at MPM Capital, and Brigitte Smith, of GBS.
Focusing on creating a pipeline of antibody therapeutics based on its antibody engineering and expression technology, KaloBios in-licensed two compounds last year planning to move them into clinical trials. KB001, a preclinical candidate to treat lung infections caused by Pseudomonas aeruginosa, was developed by a team of researchers at the Medical College of Wisconsin in Milwaukee and the University of California at San Francisco.
The company said the monoclonal antibody is designed to neutralize the action of the PcrV protein and inhibit the disease-causing process of Pseudomonas, which can lead to hospital-acquired infections in cystic fibrosis and mechanically ventilated patients. KaloBios said the product would work as both a prophylactic and a treatment.
A second antibody, KB002, to treat autoimmune diseases, was in-licensed from the Ludwig Institute for Cancer Research in Melbourne, Australia, and the company expects initial trials of the antibody to be in patients with rheumatoid arthritis. KaloBios said the first-generation antibody could enter human trials during the second half of this year.
The recent financing adds to the $4 million in seed money the company raised in June 2003.
Insmed Completes $35M Financing
Insmed Inc., of Richmond, Va., reached agreements with institutional investors for a private financing, totaling $35 million, with proceeds to fund development activities for SomatoKine, its IGF-1 therapy designed to treat growth hormone insensitivity syndrome.
The financing will be five-year convertible notes bearing interest at 5.5 percent per year. The company said the notes will become due in nine equal quarterly installments starting March 1, 2008, and ending March 1, 2010. The notes could be converted into shares of Insmed's common stock at a price of $1.30 per share, and Insmed will issue warrants in connection to the offering that will be exercisable for up to 14.9 million shares at a price of $1.36.
Net proceeds are expected to total $32.8 million. In addition to SomatoKine work, funds also will provide working capital. San Francisco-based Wells Fargo Securities served as lead placement agent, and New York-based C.E. Unterberg, Towbin and Trout Capital acted as co-placement agents.
Insmed said last week that it received acceptance to file notification from the FDA for its new drug application for SomatoKine (mecasermin rinfabate), a once-daily, subcutaneous injection. The company said it expects the FDA to take action by Nov. 3. SomatoKine previously received orphan drug designation.
Following a pivotal Phase III trial, Insmed reported that children who received the SomatoKine IGF-1 (insulin-like growth factor-1) therapy showed a statistically significant increase in height velocity, and demonstrated improvement in blood sugar in diabetic patients. Insmed said the product also showed improvement in muscle protein synthesis and appeared to reduce the inflammatory response associated with trauma.
Insmed's last financing occurred in November. The company raised about $8.7 million through the sale of common stock and warrants for the additional purchase of common stock. The transaction involved the sale of about 6.5 million shares of newly issued stock at $1.35 per share, with warrants to purchase about 3.25 million shares.
The company posted a net loss of $7.6 million for the quarter ending Sept. 30, and reported cash and cash equivalents totaling about $7.8 million. Its fourth quarter and year-end earnings were to be released Wednesday after the markets closed.
Insmed's shares (NASDAQ:INSM) lost 3 cents Wednesday to close at $1.21.
Encysive Closes $115M Offering
Houston-based Encysive Pharmaceuticals Inc. closed its previously announced offering of $115 million principal amount of its convertible senior notes due 2012, through a private placement to qualified institutional buyers.
The company has said it intends to use the proceeds of the offering to fund further clinical development, marketing and pre-launch activities related to Thelin (sitaxsentan), the company's lead drug candidate, as well as to further its research and development of other products, and for general corporate purposes, including capital expenditures and other working capital requirements.
The closing included the exercise in full by the initial purchasers of the notes of their option to purchase an additional $15 million principal amount of the notes. The notes will bear interest at a rate of 2.5 percent per year and be convertible into Encysive common stock at an initial conversion rate of about 71.7 shares of common stock per $1,000 principal amount of notes, equivalent to a conversion price of about $13.95 per share. Encysive said it may redeem the notes on or after March 20, 2010, if its stock trades above 140 percent of the conversion price for a specified period.
The company's stock (NASDAQ:ENCY) rose 27 cents Wednesday to close at $11.07