LONDON - A management buyout team of 26 scientists from Aventis Pharma AG has joined forces with Imperial College in London to raise #7.2 million (US$10.4 million) in venture capital for the formation of a new drug discovery company, Argenta Discovery Ltd.

The scientists, based at Aventis' research facility in Dagenham, Essex, were to be relocated as a result of the ongoing worldwide rationalization of Aventis' resources. Not wanting to move, or to be split up, they approached Company Guides, a private investment firm that specializes in the formation of new companies. The rationalization follows the formation of Aventis SA in December 1999, through the merger of Hoechst AG and Rhone-Poulenc SA.

David McMeekin, chairman of Company Guides, told BioWorld International, "We were already working with Imperial College to look at ways of commercializing some of its research. When we were approached by the [Aventis] team we realized that if we put the two bits together we would have a very attractive proposition for the venture capitalists."

Argenta already has a contract with Aventis Pharma relating to medicinal chemistry and biochemical screening work that the scientific team performed in house, and said it is talking to other companies about similar contracts. It will also set up proprietary drug discovery programs around novel targets sourced from Imperial College and other academic collaborators. It plans to develop compounds through lead optimization to validated leads before licensing them out.

"With a cash flow from start-up and access to novel targets from Imperial, this is a very enticing proposition, " said McMeekin.

The money has come from MVM Ltd, the venture capital arm of the government-funded Medical Research Council, and 3i plc, both based in London, with TTP Ventures of Cambridge, UK, and Genavent, of Paris. Genavent was created in January by Aventis and the French banking group Societe Generale.

McMeekin said the funding will allow Argenta, currently based at Aventis' site in Dagenham, to move to its own custom-built premises in Harlow, Essex, early next year. The company has acquired equipment from Aventis that also will be moved to the new facility. By then, there is expected to be a staff of about 40. Argenta is not expected to need to raise any more money before moving into profit.

A CEO has not been announced yet. The four senior members of the management buyout team are Chris Newton, chief science officer; Alan Roach, director of marketing and business development; Don Daley, director of information technology; and Peter Lockley, director of biochemistry and screening.

Argenta will be working with both the School of Medicine and the Department of Chemistry at Imperial College. It said that fostering collaboration between these two disciplines, which traditionally only come together within pharmaceutical companies, and then well down the development pipeline, will improve the quality of its leads and reduce the subsequent failure rate.

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