By Randall Osborne

West Coast Editor

Almost exactly one year after a restructuring, name change and the quashing of its beta blocker under development for heart failure, Incara Pharmaceuticals Corp. nailed down a potential $18.9 million equity financing facility to advance its liver precursor cell therapy program, among others.

"We signed the agreement, and we'll file a registration statement [with the Securities & Exchange Commission], and then we can issue the drawdown notices," said Bennett Love, vice president of corporate planning at Research Triangle Park, N.C.-based Incara. "It could be as long as three months from now, or it could be only a few weeks."

Under the terms of the deal, Torneaux Fund Ltd., of San Francisco, will buy Incara common stock over the next 15 months, with Incara controlling the price and quantity. If the stock stays within the minimum price threshold specified in the agreement - which Love declined to disclose, pending SEC paperwork - the investment will be at least $3 million and possibly as high as $18.9 million. Included are warrants equal to 15 percent of the shares purchased.

"We expect to be pulling down all the line," Love said. How much the line will total "depends on the stock price," he added.

Incara, formerly Intercardia, gained its current name last year, upon restructuring its relationship with Lexington, Mass.-based Interneuron Pharmaceuticals Inc. The latter reduced its ownership of Intercardia from 61 percent to 9 percent while increasing its interest in Bextra (bucindolol), the beta blocker that was being developed by the two companies. (See BioWorld Today, July 19, 2000, p. 1.)

The same month, Interneuron stopped its trial of Bextra, after a data safety and monitoring board found no significant survival advantage. Incara's stock tumbled 72 percent on the news. (See BioWorld Today, July 30, 2000, p. 1.)

"We still, of course, know the people at Interneuron, and Interneuron owns some shares of ours," Love said. "I'm not certain how many. It's less than 10 percent."

These days, Incara is pursuing three lines of research: the liver precursor cell therapy, for liver failure; small-molecule catalytic antioxidants for stroke and chronic bronchitis; and an ultra-low molecular weight heparin for the treatment of inflammatory bowel disease.

"The liver precursor program has existed for about three years, through a sponsored research program with the University of North Carolina, in Chapel Hill," Love said. "That's the one that sometimes gathers more attention, but I wouldn't consider any one of them to be the lead program."

Liver precursors comprise a subpopulation of cells in the liver that can differentiate into a variety of daughter cells to provide liver function, thus potentially reducing the need for liver transplants, for which organs are in short supply. Researchers isolate the viable liver precursor cells from livers deemed unfit for organ donation.

Incara aims to start clinical studies next year, injecting the cells as a treatment for children with life-threatening inborn metabolic problems and for adults with chronic liver failure.

People with chronic liver disease are hospitalized about 300,000 times each year, and about 30,000 deaths occur. Only about 4,500 livers appropriate for transplant become available annually, and the cost of the procedure (with first-year follow up) is more than $300,000.

The second program, focused on catalytic antioxidants, is expected to enter clinical trials for stroke in mid-2001.

The third program features a licensed heparin product called OP2000, which is being investigated as a once-daily treatment for inflammatory bowel disease (IBD). Phase I trials are finished, and Incara said it will begin a Phase II/III trial at 28 medical centers for ulcerative colitis, one of the two common forms of IBD. In Europe, OP2000 has been studied in over 150 subjects and patients in Europe with no significant unexpected side effects.

Incara's stock (NASDAQ:INCR) closed Friday at $2.50, up 37.5 cents.

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