Privately held DepoTech Corp., which focuses on sustained-releasedrug delivery, closed on a private financing of $6.1 million. The LaJolla, Calif., company now has raised more than $17 million in thepast 12 months.
DepoTech is working with Chiron Corp. in the development ofDepoCyt, formerly called DTC 101, a sustained-release formulationof the cancer drug ara-C, or cytarabine. It is in a Phase III trial beingtested in cancer patients whose primary cancers have metastasized tothe meninges.
DepoTech has raised about $25 million since its founding in 1989.MDS Health Ventures Inc., of Ontario, is a new investor to thecompany, and led the financing. Previous investors participatingagain included Brentwood Associates, of Los Angeles; BrinsonPartners, of Chicago; Burr, Egan, Deleage & Co., of San Francisco;DSV Partners, of Princeton, N.J.; Norwest Venture Capital, ofMinneapolis; Sanderling, of San Francisco; Sorrento Ventures, ofSan Diego; and Walden Ventures.
"We are pleased to have completed this successful private financingat a favorable valuation in the current, uncertain financingenvironment," said Edward Erickson, president and CEO ofDepoTech. "These proceeds ensure that our balance sheet remainsstrong."
Erickson told BioWorld that DepoTech is "looking at the publicmarkets very carefully. We're trying to determine when and if toconsummate a deal" that would result in the company going public.
The Phase III trial started in March, and is being expanded intoCanada. The trial will involve 120 patients divided into threesubindications, based on where their primary cancer came from:lymphoma, leukemia and solid tumors. The randomized, controlledtrial is comparing DepoTech's encapsulated cancer drug withstandard chemotherapy drugs. An endpoint is the clearing of cancercells from the cerebrospinal fluid.
Erickson said DepoTech plans to file a new drug application in 1995.
The company's encapsulation technology is referred to asDepoFoam, which is composed of small lipid particles containinghundreds of internal chambers. The water-filled chambers areseparated by a single bi-layer lipid membrane. Water-soluble drugsmay be dissolved in the chambers for sustained release when injectedinto the body.
Chiron, of Emeryville, Calif., made a $2.5 million equity investmentin DepoTech as part of the deal that gave Chiron exclusivemarketing rights to DepoCyt in North America and Europe. n
-- Jim Shrine
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