LONDON - Arcoda Pharma Group, a holding company set up to acquire and develop emerging companies, will float on the unregulated London market, Ofex, raising #7.5 million (US$12 million).
Arcoda was established by Jim Coombes, a co-founder of Cantab Pharmaceuticals plc, with Joe Arend, who was involved in the formation of a number of companies including Antisoma, Prolifics and Enzacta.
The aim is to develop a federation of independent companies that will all be run by Arcoda managers, sharing costs but maintaining independent R&D operations.
Joe Arend, CEO of Arcoda, told BioWorld International, "What we are offering is a long-term relationship with Arcoda supplying the commercial, financial, legal and regulatory expertise that start-ups generally lack.
"We will be on the board of directors of the companies we back and be with them until they get to Phase IIa, when we will do deals and float them on."
Arcoda already has found two companies to back, Algex Pharma Ltd. and Therapeutic Developments Ltd. (TDL).
Algex, a spin-off from University College London, specializes in small-molecule pain-killing drugs that operate through the peripheral nervous system. Founded in 1995 by John Wood, a pain expert, the company already has a licensing deal with AstraZeneca plc and a collaboration with Merck. It has three potential candidates. Arend said Arcoda is investing #1 million, which will last for 18 months.
TDL, a spin-off from Cardiff University in Wales, specializes in small-molecule drugs for cancer and multiple sclerosis. It has three entities in preclinical development, and Arend said the #1 million Arcoda is investing will enable the company to take these through to the clinic in the next 18 months to two years.
Arend said that although it is not easy to raise money for biotechnology at present the reaction to Arcoda had been good. "It comes down to the science," he said, "the fact that investors know we have ring-fenced the intellectual property, and that there is a high caliber of commercial management."
Arcoda is assessing two more companies, and Arend said it would find additional funding if good opportunities came up. It is interested in sourcing money and intellectual property from Europe as a whole. He expects to raise more money within 18 months, either by going for a full listing or floating on companies in the group.