By Kim Coghill
NewBiotics Inc. entered into a joint venture with Elan Corp. plc to develop a product to treat colorectal cancer in patients who do not respond well to standard chemotherapy.
San Diego-based NewBiotics, a private company, will retain exclusive rights to the product, called NB1011, in Japan, Asia and other areas of the world. Rights in Europe and North America will be controlled by the joint venture, said Raymond Poon, NewBiotics' executive vice president, and eventually those rights will be split on a 50-50 basis.
Dublin, Ireland-based Elan will invest in Series D preferred shares of NewBiotics at a premium to the current market value, Poon said. Also, the deal calls for Elan to make certain up-front and milestone payments, and to make a line of credit available to NewBiotics.
"Elan has a reputation as an aggressive, high-growth pharmaceutical company so they will make an excellent partner," Poon said. "Another reason we were interested in this agreement is that we wanted to maintain ownership of the product either on a regional basis or on a part-ownership basis."
NB1011 is part of NewBiotics' core enzyme catalyzed therapeutic agent (ECTA) technology for targeted cancer and anti-infective drug discovery. The technology may enhance the beneficial effects of antibiotic therapy or chemotherapy while minimizing damage done to healthy cells. NewBiotics has identified one of the key resistance mechanisms blocking the full therapeutic effects of commonly used chemotherapeutics such as fluoropyrimidines, Tomudex and doxorubicin. The ECTA technology uses the resistance mechanism to generate antitumor compounds inside the cancer cell.
Poon said NewBiotics will file an investigational new drug application in a few weeks and the company expects to begin clinical trials on NB1011 within the next few months.
Meanwhile, NewBiotics' other primary product, NB2001, an ECTA substrate of the enzyme dihydrofolate reductase (DHFR), is in preclinical development for hematological cancers and head and neck cancer.
Poon said the company has other compounds in its pipeline, "but nothing ready to test in animals."
NewBiotics was founded in November 1997 and is focused on developing drugs to overcome common enzyme-mediated drug-resistance mechanisms in cancer and infectious diseases.
An initial round of funding came from individuals, as well as venture capital firms, including Alfa Capital, of Berkeley, Calif.; Life Sciences Partners, of Amsterdam, the Netherlands; and Nevada-based HMCH Ventures.
In its Series A financing, the company raised $2.4 million in private equity, and in its Series B round, NewBiotics raised $6.2 million. The Series C round, expected to close in a month, is expected to raise $10 million to $15 million, Poon said.