BioWorld International Correspondent

Danish gene therapy firm ZGene A/S raised DKK15 million (US$2.3 million) in a second funding round to advance its technology platform, which is based on boosting the activity of cytotoxic nucleoside analogue drugs used to combat cancer and viral infections.

Symbion Capital I A/S and Dansk Innovationsinvestering P/S participated in the transaction, which brings ZGene's total funding to DKK22.2 million since its formation two years ago as a spin-off from Ballerup-based NeuroSearch A/S.

Raising the cash was "extremely difficult," CEO Zoran Gojkovic told BioWorld International. "In Denmark, at least, it's a very tough time," he said. The share crash Genmab A/S, of Copenhagen, suffered last October when its lead drug candidate, HuMax-CD4, failed in a Phase II clinical trial created a "nuclear winter," Gojkovic said. Many investors were scared off.

ZGene, which is based at the Technical University of Denmark (DTU) in Lyngby, now has sufficient cash for about two years. The company's main priority, Gojkovic said, is to form a partnership with a vector specialist in order to create a delivery route for its ZGene Activation System (ZAS). The platform is derived from the work of three scientists - Birgitte Munch-Petersen, at Roskilde University, and Jure Piskur and Wolfgang Knecht, both at DTU. It is based on the premise that phosphorylation of nucleoside analogue prodrugs is the rate-limiting step that governs their bioactivity. ZGene aims to magnify their action by delivering genes encoding kinase enzymes, as well as the prodrug, to cancer cells or virally infected cells. The company is working with several nonhuman kinases that have been optimized to act on specific substrates.

"It's much, much easier than real' gene therapy," Gojkovic said. The treatment is acute in its duration, and the expression levels of the delivered genes do not have to be controlled as finely as is the case with genes encoding a therapeutic protein.

ZGene is working with well-known cytotoxics. Its system also could potentially be used with compounds that have failed Phase III trials, Gojkovic said. Its lead program involves the use of AZT as a treatment for cancer, for which it was originally developed in the 1960s. ZGene is concentrating on solid tumors, as they can be treated directly by injection. The company is conducting animal studies at present. It has no immediate plans to enter the clinic, Gojkovic said.