As it works to develop effective drugs for blood cancers, Salmedix Inc. filed for an $86.25 million initial public offering less than a month after completing its Series C financing.
Founded in November 2000, the San Diego-based company plans to list its shares on the Nasdaq National Market under the symbol "SMDX."
New York-based SG Cowen Securities Inc. will serve as the sole book-running manager, with Pacific Growth Equities LLC and JMP Securities, both of San Francisco, and New York-based ThinkEquity Partners LLC serving as co-managers.
Salmedix officials are in an SEC-imposed quiet period and declined to comment Monday, but according to the company's prospectus, Salmedix plans to use proceeds for clinical trials of its product candidates, for licensing and preclinical development expenses, for pre-commercialization expenses and for other general corporate purposes. The company also might use some proceeds to acquire or invest in products or complementary businesses or to gain rights to such technologies.
Salmedix's lead product, SDX-105, has been marketed in Germany as Ribomustin for more than 10 years to treat non-Hodgkin's lymphoma, chronic lymphocytic leukemia (CLL), multiple myeloma and other solid tumors.
In May 2003, Salmedix acquired exclusive rights to develop, manufacture and market the drug, an intravenously administered small molecule, in the U.S. and Canada from Fujisawa Deutschland GmbH, of Munich, Germany. Salmedix began pivotal Phase II trials of SDX-105 in September, evaluating it as a single agent in non-Hodgkin's lymphoma patients who failed to respond or relapsed within six months of Rituxan treatment. (See BioWorld Today, Oct. 1, 2003.)
A second Phase II trial enrolling 60 patients should begin this quarter. Once those trials are complete, the company intends to file a new drug application that would include data from ongoing Phase III trials in Europe sponsored by Fujisawa Deutschland.
Salmedix intends to market SDX-105 and its other drugs for hematologic cancers in the U.S. by itself. It would partner its products outside the U.S. and for non-hematologic cancer indications. And it would work to broaden its portfolio through internal development and in-licensing.
Aside from SDX-105, Salmedix also is studying two other in-licensed, clinical-stage products: SDX-101 and SDX-102. SDX-101, an isomer of the marketed anti-inflammatory drug Lodine (Wyeth), has shown a reduction in white-blood-cell count and no hematologic toxicities in CLL patients. Salmedix plans to begin a Phase II trial in the second quarter and to evaluate the use of SDX-101 in combination with SDX-105 in the future. The product has orphan drug status for the treatment of CLL.
SDX-102 is an intravenously administered small molecule that acts against tumors that cannot produce a metabolic enzyme. It showed minimal activity in trials conducted by the National Cancer Institute, but Salmedix developed an assay to identify patients who might be more responsive to treatment. The company is using its assay to select patients for Phase II trials in non-small-cell lung cancer, pancreatic cancer, sarcoma and mesothelioma - all cancers not studied in the NCI trials. SDX-102 also might enter a clinical trial in the middle part of this year in patients with malignant brain tumors. That study would be conducted as part of a collaboration between the company and the New Approaches to Brain Tumor Therapy cooperative group.
In addition to its three clinical programs, Salmedix has two internally developed preclinical programs. The first program is developing chemical analogues of SDX-101 that are orally active in animal models and exhibit more potent tumor-killing activity. Its second preclinical program is testing analogues of indanocine, SDX-103, which has displayed broad anticancer activity in Salmedix's studies and in NCI screening assays.
The hematology and oncology market grew to about $2.3 billion in 2003, shared by drugs such as Rituxan (Genentech Inc.), Gleevec (Novartis AG), Campath (ILEX Oncology Inc.) and Velcade (Millennium Pharmaceuticals Inc.). The market could reach $7 billion by 2010, Salmedix said in its prospectus.
As of Dec. 31, Salmedix had about $14.9 million in cash and cash equivalents.
The company raised $45 million in a Series C financing conducted earlier this month. The third round gave the company about two years of money, its Chairman and CEO David Kabakoff said at the time. Salmedix has raised a total of $82.5 million in its three rounds combined. (See BioWorld Today, June 21, 2002, and April 2, 2004.)