By Chris Delporte

ActivX Biosciences Inc. completed a $20 million private placement in its second round of funding to advance its work in activity-based proteomics.

The privately held company?s first round of funding, totaling $6 million, was generated through seed financing completed in April 2000 and a Series A funding completed in August. For this most recent round, the company?s original investors, Frazier & Co., of Seattle, and ProQuest Investments, of Princeton, N.J., were joined by Oxford Bioscience Partners, of Boston; Vulcan Ventures, of Seattle; CIT Venture Capital, of New York; and Novo A/S, of Denmark.

Though the pool of available venture capital funds isn?t as deep or as vast as it was 18 months ago, David Humphrey, ActivX?s vice president of finance, told BioWorld Today that the company didn?t have too hard a time finding investors.

?We had a lot of interest,? Humphrey said. ?The valuations certainly aren?t what they were a year ago, but the money is out there. It still takes awhile, though, to close the loop.?

ActivX currently employs 25 people and hopes to grow to 50 by the end of the year. The funds generated by the private placement will fuel that growth, providing resources for additional lab facilities and equipment, Humphrey said. The company has no immediate plans to use the funds for licensing or technology acquisitions.

La Jolla, Calif.-based ActivX was founded in the early part of 2000 by Robert Hillman, chief operating officer; Benjamin Cravatt, assistant professor at The Scripps Research Institute in San Diego; and Jeffrey Smith, associate professor at The Burnham Institute, also in San Diego. Cravatt and Smith sit on the company?s scientific advisory board.

ActivX?s technology is focused on activity-based proteomics, the identification and analysis of active proteins, to increase the speed and cost effectiveness of target discovery and drug development. The company is developing a high-throughput chemistry platform for identifying and analyzing active proteins in all ranges of abundance in any biological sample. According to ActivX, current genomics and proteomics technologies do not report on protein activity, which is an end-stage event that regulates both health and disease.

By providing what it calls the first global analysis of protein activities, ActivX?s proteomics approach addresses the gap between the data generated by standard genomics and proteomics techniques and the therapeutic relevance of that data. ActivX identifies active proteins through the design and synthesis of novel chemical probes that have the ability to rapidly and directly interrogate the activities of key protein families. The process is called ?chemical tagging.? The chemical probes designed by ActiveX are designed to quantify the changes in protein activities in any cell type and tissue over a range of normal and pathological conditions.

?The heart of it is the chemical technology,? Hillman told BioWorld Today. ?We can identify proteins by class and really pick out specific active proteins. Though we?re a very young company, we?ve made tremendous advances. Now we?ll be able to apply this to specific biological problems.?

The technology has direct applications in the identification of novel drug targets, the determination of target selectivity for drug candidates and the ability to assess drug efficacy and toxicity.

To drive short-term and long-term revenue growth, the company is pursuing a two-tiered business strategy. This first goal is to establish research collaborations with pharmaceutical and biotechnology companies. The collaborations will, according to the company, most likely consist of up-front technology access and exclusivity fees, in addition to research funding, milestone payments and royalties on commercialized products.

The second involves internal drug discovery and development programs in selective therapeutic areas. ActiveX said the long-term value of the company will be in its ownership of novel targets and the combination of licensing and internal development of the targets.

The company already has begun looking at applications for its technology in pharmaceuticals, examining therapies for cancer and diabetes-related obesity.

?Several companies are interested in working with us,? Hillman said. ?With the funding behind us, we?ll be talking to people in a more focused way.?

In addition to its latest round of funding, ActiveX also announced key promotions.

Company board member Paul Schimmel was named chairman. Schimmel is a co-founder of three publicly traded biotechnology companies, Alkermes Inc., Cubist Pharmaceuticals Inc. and Repligen Corp., and currently is a professor at Scripps.

John Kozarich, former company president and chief operating scientific officer, was promoted to CEO in addition to his role as president. Hillman, recently named COO, was the company?s previous CEO.

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