By Brady Huggett

It¿s who you know, even in biotechnology.

Flexing its friendships, Rinat Neuroscience Corp. raised $17.5 million in its Series A round with the help of Tularik Inc., and entered a licensing agreement with Genentech Inc. for both technology and access to research materials.

Arnon Rosenthal, president, chief technical officer and a co-founder of the Palo Alto, Calif.-based company, had a lot to do with Rinat¿s name-brand start, said Patrick Lynn, Rinat¿s other founder and its CEO.

¿Arnon has a good relationship with Dave Goeddel, [co-founder and CEO] of Tularik,¿ Lynn said. ¿Goeddel is acting chairman of our board. And, Arnon had been [at Genentech] for 17 years ¿ we have a great relationship with them.¿

That great relationship helped lead to Genentech, of South San Francisco, licensing genomic and bioinformatics technologies to Rinat, as well as Rinat receiving the right to use for research in the neurology field a number of secreted proteins, receptors and antibodies, although Genentech retains ownership rights. Also, Genentech transferred or licensed research tools to Rinat for it to apply in the neuroscience field and has given Rinat the right to explore ¿ for a set period of time ¿ a number of drug leads for neuroscience applications. With all this in hand, the financing trail became much smoother, Lynn said.

¿That was the triggering of the funding,¿ he said. ¿The Genentech deal was a foundation piece that we could stand on and use. That was the real watershed event that allowed us to assemble everything else.¿

The $17.5 million could be seen as a birthday present. Rinat ¿came into existence¿ in November 2000 in Delaware, Lynn said, and spent the major portion of its first year working out the details of the Genentech licensing agreement. Lynn estimated a Series B round of funding in about 18 months.

Along with Tularik, of South San Francisco, investment in the Series A round came from Technology Partners, of Palo Alto, Calif., and Essex Woodlands Health Ventures, of Montgomery, Texas, as well as private investors.

Privately held Rinat is focused on the discovery and commercialization of drug and drug targets for mental and neurodegenerative disorders. It has preclinical work under way for neuropathy, Alzheimer¿s disease, Parkinson¿s disease and nerve injury. By looking at the function and gene expression of neurons and examining neuronal populations that are clinically relevant to disease states, Rinat expects to ¿drill down to the lowest common denominator of a disease state,¿ Lynn said.

¿In addition to that, we will be able to do drug discovery,¿ Lynn added. ¿That will feed more preclinical molecules, we hope.¿

If access to Genentech¿s antibodies, receptors and proteins does bear fruit, Lynn said, the companies could collaborate on development. However, if Rinat comes up with drug candidates on its own, the company will either forge ahead alone or seek partners.

The company has three preclinical compounds and is conducting work in animals; 2002 should bring a furthering of that effort.

¿In the next year I¿d like to have a lot more information on our preclinical molecules,¿ he said. ¿I¿d like to be seriously into animal models. Another thing we¿d like is to be in partnerships to look at small molecules for screening for drug leads using some of our assays we are setting up.¿

Rosenthal is a native of Israel. As a co-founder and ¿the first one to get this going,¿ Lynn said, Rosenthal received the honor of naming the company. Thus ¿Rinat,¿ the Hebrew word for happiness. It also is fitting that Rosenthal chose the company¿s moniker considering how much his relationships helped shape it.

¿Richard Scheller [senior vice president of research at Genentech] is on our advisory board,¿ Lynn said. ¿We¿ve got a paper deal [with Genentech] but also a deal among people, and that goes a lot further.

¿We¿ve got great backers,¿ he added. ¿We¿ve got a lot of momentum, the technology and the know-how. I think we are going to be a real powerhouse. We¿re excited and ready to rock and roll.¿