JERUSALEM ¿ MPM Capital LP and Clal Biotechnology Industries Ltd. (CBI) signed final agreements to invest $15 million, in two installments, in Jerusalem-based Mindset Biopharmaceuticals Inc. for a majority interest in the biotechnology company focused on Alzheimer¿s disease.

Mindset received $8 million and would get $7 million upon attainment of a milestone, the initiation of Phase I clinical trials, which Mindset founder and CEO Daniel Chain told BioWorld International is anticipated for the end of 2002.

MPM, one of the largest asset management firms, with over $1 billion dedicated to the life sciences, and Tel Aviv-based CBI, Israel¿s leading investor in life sciences, acted as co-lead investors in this round of financing, committing $9 million and $6 million, respectively.

One of Mindset¿s numerous CNS-related programs already is bringing in income: a drug evaluation service using a transgenic mouse model of AD that saves pharmaceutical companies up to two years development time, said Iren Zeitoun, who heads the marketing of this service. ¿We anticipate generating $10 million in revenues over the next year,¿ Chain added.

Mindset is developing its own neurological drugs.

Paul Bendheim, chief medical officer, told BioWorld International, ¿Our lead proprietary compound, Oxigon, has been shown to have a dual mode of action. It is an extremely potent antioxidant, thus reducing cell injury and cell death associated with Alzheimer¿s disease, and an inhibitor of beta-amyloid fibril formation, one of the major pathological manifestations of this neurodegenerative disease.¿

Following completion of Oxigon Phase I trials, the Alzheimer¿s Disease Cooperative Study consortium, headquartered at the University of California, San Diego, and chartered by the U.S. National Institute of Aging, will sponsor and finance a Phase I/II trial.

Another of the company¿s major programs is a dual active and passive immunological attack to reduce beta-amyloid in the brain, designed to prevent or even reverse amyloid plaque formation.

MPM Capital founding general partner Ansbert Gadicke will join the Mindset board.

David Haselkorn, CBI¿s CEO, told BioWorld International, ¿Our in-depth due diligence gives us assurance that Mindset¿s technology, set of research-action programs and pipeline of products to treat Alzheimer¿s disease, combined with its business model and plan, have great prospects. We are pleased to become a substantial shareholder in Mindset with MPM. This is an important step forward for the biotechnology sector in Israel, while strengthening CBI¿s activities in the field of CNS therapies.¿