Neocrin Co. said Friday it raised $12.5 million in a self-managedprivate offering, which brings to a total of $28.25 million that theIrvine, Calif. company has raised since its founding in May 1992.

Neocrin is developing a bioartificial pancreas designed to providenear-normal glucose regulation for Type I diabetics. BaxterHealthcare Corp., of Deerfield, Ill., formed Neocrin with TranCelCorp.'s venture backers.

Neocrin's pancreas, being developed as an implantable device,contains purified clusters of porcine pancreatic islet cells capable ofsecreting insulin and other hormones. The device consists of severalhundred thousand islets covered with polymeric capsules enclosed ina larger, single-unit membrane device.

Previous investors participating in the financing include AspenVenture Partners, of Boston; Domain Associates, of Princeton, N.J.;The Sprout Group, of Menlo Park, Calif.; Asset ManagementAssociates, of Palo Alto, Calif.; New Enterprise Associates, of SanFrancisco; Alliance Technology Ventures, of Atlanta; BaxterHealthcare; and CytoTherapeutics Inc., a Providence, R.I., companythat in 1993 took an equity position in Neocrin in exchange for theassets and intellectual property of CytoTherapeutics' diabetesprogram. Baxter, with a 30 percent stake, is privately held Neocrin'slargest shareholder.

New Neocrin investors were led by Hancock Venture Partners, ofBoston, and included Forrest, Binkley and Brown, of NewportBeach, Calif.; Sofinnova Inc., of San Francisco; and GIMVInvestment Co., of Antwerp, Belgium.

"We're pleased with what we raised in this round," Greg Dane,Neocrin's president and CEO, told BioWorld. "It can take us throughour large-animal studies, which will then allow us to raise additionalmoney."

The studies are being conducted in dogs and primates, Dane said, andare expected to be completed by the end of the year. He said thecompany hopes to file an investigational new drug application earlyin 1996.

"Our expectation is this [bioartificial pancreas] will provide near-normal blood glucose regulation without the need for insulininjections," Dane said. "These cells would act as your normalpancreatic cells do _ to sense blood glucose and secrete insulin ondemand."

Type I diabetes is an autoimmune reaction that destroys the islets ofLangerhans, the specialized group of cells in the pancreas thatnormally produce insulin.

In a separate move, Neocrin said David Scharp joined the companyas chief scientific officer and vice president of medical affairs.Scharp, an islet transplant surgeon, had been working with Neocrinwhile on a leave of absence from Washington University in St. Louis.n

-- Jim Shrine

(c) 1997 American Health Consultants. All rights reserved.