Avera Pharmaceuticals Inc. raised $16 million in Series A financing, named a CEO and acquired a series of neuromuscular blocking agents from GlaxoSmithKline plc.
The San Diego-based company was founded in early April to focus on the in-licensing and development of drugs in the neuroscience area. However, it was just this week that the company presented itself, announcing the appointment of Jeffrey McKelvy, an executive with 25 years of experience in drug discovery and development in the neuroscience field.
On the same day, Avera reported its deal with London-based GSK and its Series A financing. Avera acquired worldwide rights to the compounds and the supporting patent estate. In return, GSK took an undisclosed equity position in the company.
McKelvy said the funding should take the company forward about a year and a half.
"It will allow us to continue the development of the lead Glaxo asset, which we call 430A, through Phase II, and also to acquire, through in-licensing, one to two clinical-stage neuroscience compounds for psychiatry or neurology indications," McKelvy said.
The company, at this point, is not focusing on specific diseases.
"There are such huge unmet needs across all disease categories that we're being opportunistic," he said. "What we've discovered is that there are several attractive compounds that are available - compounds with promising preliminary data.
"We think this is a reflection of the fact that the big pharmas' pipelines are too full for them to be able to develop all of their candidates," he said. "You're not looking at compounds that are shopworn or flawed."
Venture capital firms also are lending their support to emerging small pharmaceutical companies such as Avera, McKelvy said, referring to his new firm as a specialty pharmaceutical company, which was an advantage when determining valuation.
Avera became aware of GSK's neuromuscular compounds via a group GSK established internally to focus on out-licensing compounds that no longer fit its strategy, McKelvy said.
The compounds are potent muscle relaxants used to make it easier when intubating patients during surgery, and to relax muscles generally during any surgical procedures.
The compounds, for which development will be outsourced by Avera, already are in Phase I studies, and plans are under way to take them into Phase II, McKelvy said. They were discovered jointly by GSK and researchers at Cornell University in Ithaca, N.Y. Avera also signed an exclusive, worldwide license agreement with Cornell Research Foundation Inc. regarding Cornell's interest in the patent estate in exchange for undisclosed milestone and royalty payments.
Avera's financing was led by Frazier Healthcare Ventures, of Seattle. Other investors were Bay City Capital, of San Francisco; InterWest Partners, of Menlo Park, Calif.; Windamere Venture Partners LLC, of San Diego; St. Paul Venture Capital, of Boston and Minneapolis; and BTG plc, of London.