BioWorld International Correspondent

MUNICH, Germany - Biotech venture investment in Germany continued to show signs of thawing, as two companies from disparate ends of the market drew a total of €30 million in new funding.

Cilian AG, a start-up based in Muenster, raised €5 million, while Evotec Neurosciences (ENS), a subsidiary of publicly listed Evotec OAI AG, of Hamburg, took in €25 million. Both companies said the promise of their pipelines and their commitment to developing new therapeutic compounds were prerequisites for their investments.

"The investors liked two things in particular about ENS," Joern Aldag, president and CEO of Evotec OAI told BioWorld International. "First, they liked the balance of early and late preclinical compounds in our pipeline. That started with our deal in August 2003 with Takeda and continued with compounds we have in-licensed from Roche. Second, they liked the close connection with Evotec OAI. That means a discovery company is tightly linked with a provider of discovery services. The company is in a position to bring fully integrated operations all the way to clinical trials."

Christine Lemke, CEO of Cilian, related a similar experience. Cilian's technology offers a new approach to producing enzymes, one that could command a significant market on its own. It was the company's extension of the technology, however, that finally secured investor interest. "We want to bring products to market in other areas," she told BioWorld International.

ENS will use the investment to advance its pipeline of compounds in Alzheimer's and other diseases of the central nervous system. They all are in preclinical stages of testing, and Aldag said he expected the first products to reach clinical testing in the next 24 months.

"Our Alzheimer's work is similar to a compound that has already been approved, but it is showing a better side effect profile without losing its effectiveness," he said.

Cilian focuses on using a species of ciliates to produce enzymes. Most current production is done either with yeasts or with mammalian cells. "Because they are eukaryotic," Lemke said, "ciliates have more capabilities than yeasts, but they are not as difficult to use as mammals' cells."

Last year the company showed proof of principle of its technology, and it will use the current investment to develop its system to industrial levels of efficiency. In addition, it will use part of the venture backing to research a product to treat pancreatic insufficiency. Lemke said the company aims to test it in an animal model and to enter preclinical testing next year.

Lemke added that Cilian is actively seeking both partners and additional investors, saying the company's "eventual goal is to be a stand-alone pharma company, able to bring products through Phase II clinical testing with our own resources."

Aldag sketched a similar future for ENS. "Evotec OAI will retain a substantial holding in ENS," he said. "At the end we are aiming for 20 percent to 25 percent. ENS will be a stand-alone discovery and development company. I can envision either an IPO or an acquisition in its future."