By Mary Welch

Insmed Pharmaceuticals Inc. raised $14.5 million through a private financing to support its research and development of INS-1, a carbohydrate-based small molecule, for treatment of polycystic ovary syndrome (PCOS) and insulin resistance associated with Type II diabetes.

Major investors included Teknoinvest Funds, of Oslo, Norway, and Biotechnology Development Funds, which is managed by BioAsia Investments, of Palo Alto, Calif. Also participating were existing shareholders and private individuals in the U.S. and Europe. Prospektiva Investments, of Lugano, Switzerland, was the placement agent.

"The funds will allow us to accelerate the clinical development of INS-1 as well as our research programs that focus on other molecules in that class," said Geoffrey Allan, president and CEO.

"In both areas of our clinical research, we are dealing with conditions in which there are no effective treatments. And in the case of polycystic ovary syndrome, you're dealing with women's infertility and health issues. The [PCOS] data were fabulous and it's politically perfect. Investors get excited about that sort of thing."

Formed in 1988, the Richmond, Va.-based drug discovery company currently is in multisite Phase II trials for PCOS that should conclude by the end of the year. Phase III studies are expected to start in 1999.

PCOS is an endocrine disorder that produces an imbalance in women's hormone levels. Although the failure to ovulate is one of the most common symptoms, there are others.

"It promotes excessive facial and body hair growth, male-pattern hair loss and excessive body weight. It's a psychologically debilitating disease and it affects child-bearing as well," he said. About 4 million premenopausal women are affected in the U.S.

Preliminary results of the Phase II studies showed INS-1 restored ovulation in 86 percent of the 44 obese women with PCOS, compared with 27 percent in the placebo group. (See BioWorld Today, June 22, 1998, p. 5.)

INS-1 is also in a single Phase II trial for treatment of conditions associated with insulin resistance, which is the inability to properly metabolize insulin and is a condition that precedes Type II diabetes. Two additional Phase II trials are planned within 60 days. INS-1 acts as an insulin sensitizer, improving glucose tolerance and reducing serum insulin levels. *