Affymax N.V., a drug design company that uses optics to buildbiochemical compounds on glass chips, on Monday said it hasraised $26 million in a private placement.

The deal, involving mainly institutional investors in Europe, theUnited States and Japan, was bigger than the $15 million to $20million the company had anticipated raising. It more thanmatched the company's original financing round, which raised$25 million in 1989.

"I think the interest in Affymax is based on the technology, Dr.(Alejandro) Zaffaroni's vision of what to do with the technology,and the management experience which resides at thecompany," said David Singer, director of business development.

Zaffaroni, a founder of Alza Corp. and DNAX Research Institute,is founder, chairman and chief executive of Affymax, which isincorporated in the Netherlands but does its research throughits Affymax Research Institute subsidiary in Palo Alto, Calif.

Affymax has developed an enabling technology, called VLSIPS(very large-scale immobilized polymer synthesis), that useslight to direct the building of chemical structures on the surfaceof a glass chip. The chip surface is covered with linkermolecules with chemical groups to which amino acids can bind.

VLSIPS can rapidly screen more than 1,000 differentcompounds for an ability to bind to a biologically activemolecule, such as a receptor, monoclonal antibody or DNAsequence.

Affymax has applied for patents on the technology and has noplans to license it, said Singer. "Our goal is to become apharmaceutical company, and the priority use of thetechnology is to discover drugs," he said.

In its initial stages, Affymax will work in partnership withother pharmaceutical companies in addition to developingdrugs on its own. Affymax will announce some partnerships inthe near future, said Singer.

In connection with the financing, Tony Pritzker, groupexecutive of the Marmon Group of Chicago, has been nominatedto be a director of Affymax.

Affymax has avoided the traditional venture capital route. Itsoriginal financing involved qualified individuals plus someinstitutions. Most of the first-round investors took a position inthis round, said Singer.

-- Karen Bernstein BioWorld Staff

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