By Kim Coghill
Novirio Pharmaceuticals Ltd. raised $44 million in a private equity financing to pay for Phase III trials of two hepatitis B drugs.
Based in Cambridge, Mass., Novirio develops drugs for hepatitis B, hepatitis C and HIV/AIDS. Founded in 1998, the company raised $12 million in its first round of financing and $12.5 million in its second round, completed in November 1999.
David Franklin, Novirio¿s executive director of marketing and corporate communications, said the company currently has about $50 million in available cash and intends to use it for development of the antiviral drugs LdT and val-LdC, two hepatitis B drugs in Phase I/II clinical development. The drugs are unmodified nucleosides designed to prevent the replication of viral DNA without adversely affecting host cell function.
The company expects its hepatitis B drugs to enter Phase III studies next year. ¿The drugs work well when administered together, so that answers the question ¿ why would you develop the two drugs for the same disease at the same time,¿ Franklin said. ¿Both drugs are more effective than anything on the market.¿
Thus, Franklin said, ¿We were able to raise this money. The $44 million seems to stand out in people¿s minds because the market has been so tough. It has definitely gotten some attention. Our ability to move several compounds from preclinical to clinical in the last nine months and our ability to produce favorable data has really attracted this investment.¿
Other than the hepatitis B products, Novirio is developing a hepatitis C product known as NV-08. Franklin said NV-08 should enter Phase I trials sometime this year.
The Series C financing was led by CSFB Private Equity of New York. Existing investors are TVM Techno Venture Management, of Munich, Germany; MPM Capital, of Cambridge, Mass.; and Nomura International plc, of London. New investors are Novartis BioVentures Ltd., of Basel, Switzerland; Hanseatic Americas LDC, of New York; Biomedical Sciences Investment Fund PTE Ltd., of Singapore; Swiss Life Private Equity Partners Ltd., of Zurich; Banc of America Securities LLC, of San Francisco; and Swan Private Equity Verwaltungs GmbH, of Koln, Germany.
The first two rounds of financing were used to build the company and to support discovery work, Franklin said.