By Mary Welch

Paratek Pharmaceuticals Inc. raised $20 million in its largest private placement to date, and will use the proceeds to fund two research programs.

"We had set our sights on $15 million, so we're quite pleased," said Thomas Bigger, the company's president and CEO. "We have existing investors who participated in this round, as well as several new investors. We wanted to have a balance of U.S. and European investors, and I think we were successful. This is also the first time that Bio Fund invested in the U.S., so that was an honor."

Among the new investors are Lombard Odier Cie Ltd., of Geneva; BankInvest, of Copenhagen, Denmark; Bio Fund Management Ltd., of Helsinki, Finland; FSC Securities Corp., of Atlanta; and Nomura International plc, of London, which also acted as international placement agent. The company's three largest institutional investors now are Bio Fund, Nomura and Lombard Odier.

The four-year-old company has raised $28 million. This round represents about 25 percent of the Boston-based firm. During its first three years of operation, Paratek burned only about $4 million.

"We expect this funding will last for the next 12 to 18 months, which is about our timeframe for an IPO [initial public offering]," Bigger said. "We also believe that many of the people and companies that have invested so far will remain will us and continue to invest after we do our IPO. Many times that doesn't happen."

Paratek has two preclinical programs under way, both aimed at treating infectious diseases. The Tetracycline Resistance Project (TET) is based on medicinal chemistry. The company's second program, the Multiple Antibiotic Resistance Project (Mar), is based on novel discoveries in pathogen genomics.

The TET project is developing new tetracycline molecules designed to overcome the problem of antibiotic resistance associated with existing tetracyclines. The company's approach is to develop drug candidates that are effective against the two mechanisms for tetracycline resistance. These mechanisms are the active efflux of the drug from bacterial cells, and protection of the bacterial ribosomes from the inhibitory action of tetracycline.

Paratek said it has developed proprietary inhibitors that, when combined with a standard tetracycline, allow tetracycline to exert its antibiotic effect by overcoming and inhibiting both resistance mechanisms.

A second approach in the TET program attracted the eye of London-based Glaxo Wellcome plc. Glaxo signed a deal last year worth up to $95 million for Paratek to develop tetracycline derivatives that, when used alone, can inhibit susceptible and multidrug-resistant bacteria. The deal calls for the development and marketing of up to four tetracycline-based novel antibiotics directed at different markets. (See BioWorld Today, July 29, 1999, p. 1.)

"The project with Glaxo is going very well," Bigger said. "We are in the process of delivering a series of compounds to evaluate for use in antibiotic resistance. We are going to use money from this financing to advance the parts of our TET program that were not licensed to Glaxo. In fact, we're conducting a series of partnership meetings with other companies. We also hope to file an IND [investigational new drug application] within the next 12 months."

The Mar program is named after the MAR operon, a genetic master switch that controls the largest set of genes in a number of disease-causing gram-negative bacteria, such as Salmonella and Shigella. The program aims at developing small-molecule drugs that down-regulate Mar, returning bacteria to an antibiotic-susceptible state and preventing their ability to cause infection.

Paratek believes the MAR operon can be manipulated to disable a particularly troublesome bacterial resistance mechanism. Based on that belief, the company is developing drugs that interfere with this master switch and will render bacterial cells ultrasensitive to antimicrobial agents.

"We feel good about this placement," Bigger said. "And we feel this gives us sufficient ability to become a player in the antibacterial-resistance movement. We intend to leverage our existing technology that we've licensed from Tufts University and look for other applications as well."