Emerging Drug Developer

Emerging Drug Developer: Biolex Therapeutics

John Carroll — Mon, 13 Oct 2008 09:54:25 -0400

Investment funds still flow in Biolex's direction

This was supposed to be the year that Biolex Therapeutics went public, using funds from an IPO to advance a therapy that makes a solid, straightforward business case.

But 2008 is not that kind of year for emerging drug developers.

IPOs of every stripe are all but dead, regardless of the business case that is being made. And the Pittsboro, NC-based biotech found itself back in talks with a group of venture capitalists - many of whom had already helped the company raise its first $100 million.

When they were finished talking, Biolex had secured an additional $60 million in a Series D that should take the developer's lead therapy right to the doorstep of a late-stage trial. And at that point, Biolex plans to ink a partnership deal that will enable the company to advance to its next phase of development.

For now, most of its eggs are in mid-stage baskets that hold Locteron, an interferon alfa for hepatitis C. Unlike the current therapies on the market, Locteron is a controlled-release drug, and the company's researchers have been building a case that their approach offers a better safety profile and an easier dosing regimen for patients.

"We are very excited about Locteron's profile," Biolex CEO Jan Turek tells FierceBiotech. "A Phase IIa has demonstrated equal efficacy, a favorable side effect profile and dosing convenience. A Phase II has been completed in the U.S. but not reported yet. And a Phase IIb "will allow us to select the dose we take into the clinic."

A late-stage trial could get started in late 2010. But Biolex clearly plans to have a major partner lined up by that stage.

"Our expectation is that prior to Phase III we'll have a partnership with a major company," says Turek.

And they'll be in a position to strike a better deal than they would have even last month. Along with the new financing, Biolex engineered a new deal with OctoPlus, which had made its controlled-release technology available to the company. Biolex paid OctoPlus $11 million up front and committed to a schedule of milestones in order to buy back full rights to Locteron. And that means Biolex will take more of the rewards offered by a new partnership deal.

Biolex has two other drugs in pre-clinical development: BLX-155 for blood clots and BLX-301 for non-Hodgkin's B-cell lymphoma. But for now, the development focus is centered squarely on Locteron -- "our number one value driver," says Turek.

The News & Observer notes that Biolex has cut its staff from 106 to 90, but you get few details on who got cut or why.

Dale Sander, the CFO, says simply that the company is "appropriately staffed."

The recent venture round brings Biolex's total venture take to $165 million. Clarus Ventures led the round, with OrbiMed Advisors jumping on board as a new investor. They were joined by a big group of venture outfits that included Intersouth Partners, Quaker BioVentures, Johnson & Johnson Development, Polaris Ventures and the North Carolina Economic Development Fund.

The financial crisis has yet to freeze investment activity, says Turek.

"A lot of venture money was raised in the last 18 months by the venture funds themselves," says Turek. And that money continues to flow to companies like Biolex.

Emerging Drug Developer: TransMolecular

John Carroll — Mon, 06 Oct 2008 09:42:00 -0400

TransMolecular stays focused on a unique cancer program

There's one key point that the CEO of Cambridge, MA-based TransMolecular wants everyone to know up front.

"We are not using scorpion venom," says Michael Egan "It is one peptide in 40 in the mix of the venom."

For a biotech audience, that won't be too startling a revelation. But you'd be surprised how often it comes up, he says, in the stories that cover the company's efforts.

TransMolecular has a very narrow focus that covers a broad range of cancer therapies. Starting with research from the University of Alabama, the developer has been advancing TM601, which has the uncommon ability to bind and intrude into a tumor cell. And the implications that they had a new therapy that could act as an independent delivery agent, or perhaps even work as a therapeutic on its own, has consumed the company.

So TM601 became the company's sole concern.

"We had some key questions in the development process that we wanted to answer on this molecule," says Egan, "as opposed to taking on two or three oncology projects. The question was when it bound, what happened.

"Could we give it intravenously? What is it binding to? It sounds trivial, but it turns out to be quite a question," says the CEO. "We identified the binding site, but we haven't published it yet. It's a receptor expressed on the surface of tumor cells."

Then the company asked if TM601 had therapeutic activity by itself.

"We hunted around to see of there was inherent activity. And when you get to higher doses it inhibited blood vessels in the region of the tumor."

In the first clinical trials, glioma patients were given a dose through their surgical cavity.

"When original delivery started, it was local delivery in recurrent glioma patients who had the surgery. Then we completed the Phase II and we have early indication of increased life span. And now we're talking to the FDA about Phase III.

"Medically," adds Egan, "the key was could you give it intravenously?"

The company organized several Phase I trials where they delivered the therapy by IV and saw the kind of uptake in the tumor they were looking for. Now they've launched a Phase I/II intravenous trial that scales up to a mid-stage study. Researchers will recruit more than 50 patients for this study.

So far, TransMolecular has raised about $42 million, with Tullis-Dickerson TVM Capital and Easton Capital on its list of investors. The company moved from Birmingham to Cambridge MA and the developer now has a staff of 21.

To stay on track, the CEO is putting together another venture round before the end of the year. But don't ask him how much he plans to raise.

"In this environment, you've got to be kidding me," he says with a laugh.

He's equally quick to chuckle at the idea of planning for an IPO anytime soon.

"That discussion is a nonstarter," he says with another laugh.

Partnerships, however, are definitely on the table.

"A multi-partnership company is a possibility," says Egan. "If someone is interested in acquiring the asset, I think then it becomes more of an M&A.

"We're talking to folks who have a molecule they need to deliver specifically; that's on a couple of fronts," he adds. "We're in a process now with the objective of having partnerships in place in the next 12 months.

"In all honesty, I think our ability to take things into Phase III is pretty limited. You can do I and II in a very focused way, managing your expenses. In a Phase III scenario, that changes completely."

Emerging Drug Developer: KaloBios

John Carroll — Mon, 29 Sep 2008 08:51:08 -0400

KaloBios goes for breadth in antibody studies

For David Pritchard, the nation's financial crisis is more than a lead story in the evening news. The financial disaster created by soured mortgage-backed securities cost KaloBios Pharmaceuticals, where Pritchard is CEO, one of its primary investors when Lehman Brothers was allowed to go into bankruptcy.

South San Francisco-based KaloBios, though, isn't letting the crisis stop its work. Last week the developer reported a $20 million investment round--its fourth--that will be used to advance its antibody development work.

Pritchard, an experienced antibody player, says KaloBios is taking the antibody field one step further with its "humaneering" approach to development. By using a proprietary platform to create therapeutic antibodies that are a closer match to the body's natural template for antibodies, he says, the developer can improve its chance of achieving efficacy.

And rather than concentrate on one or two trials on the path to mid-stage data, like many other emerging biotech companies, KaloBios is opting for a range of Phase I/II studies that will plumb for data on a number of indications. More programs raise the possibility of a slate of partnership deals as the biotech weans itself off of venture capital and starts to generate its own funds needed to grow the company.

Pseudomonas aeruginosa infections are a primary focus. KB001 is in a clinical trial for ventilator-associated pneumonia. Data is expected by the end of the first quarter in 2009. The company's second indication in this area is for cystic fibrosis, where infections are a lethal threat to patients. Data from that study is expected in the early part of next year as well.

The company's anti-inflammatory programs--KB002 and KB003--involve four Phase I/II studies: one for persistent asthma, another in rheumatoid arthritis and two pharmcodynamic studies. Animal studies have demonstrated potential in asthma, COPD, rheumatoid arthritis, multiple sclerosis and psoriasis. The clinical work is aimed at determining which path has the most potential. KaloBios is also investigating an antibody for cancer and expects to file an IND next year.

Says Pritchard: "We have elected to do what I call proof-of-concept studies and go for breadth to determine the activity of the drugs rather than guess what is best and go for depth."

These are small studies, he adds, running with about 20 to 40 patients each. "So we don't expect to get clinical efficacy," he adds, "but we do hope to see activity that will help guide us to determine what multi-dose studies we do."

The trial work also lays the foundation for a round of partnering.

"We are planning to partner these programs starting early next year," says Pritchard. "We prefer co-development, co-promotion profiteering deals, where we retain some aspect of the development. But it could be small or significant."

At 50 staffers, Pritchard says there's likely to be modest staff growth at KaloBios, but nothing dramatic.

The latest venture round brings KaloBios' haul to $68 million, says the CEO, enough to reach the end of the first quarter of 2010. Mitsubishi UFJ Capital and Genzyme Ventures, both new investors, co-led the latest round with previous investors MPM Capital, Alloy Ventures, GBS Ventures, Sofinnova Ventures, Singapore Bioinnovations, Pte., 5AM Ventures and Lotus Bioscience Ventures participating. The biotech plans to go back to the investor crowd and look to raise a second tranche of $5 million to $10 million.

"We're really pleased with this financing. We've got a great valuation for it. At times of difficulty, there's a flight to quality," says Pritchard. "We expect this to be our last private round." Partnership money and possibly an IPO can finance the rest of the way. And Pritchard isn't about to rule out a buyout at some point.

"The antibody space is the hottest space for M&A activity," he adds, noting 13 acquisitions in the last three years of companies around the same size as KaloBios. "It's clear that pharma companies want to move into antibodies in a big way. So M&A is quite possible."

Pritchard knows a thing or two about value from personal experience. As CBO of Rinat Neuroscience, a Fierce 15 company, he helped arrange Pfizer's $500 million acquisition deal.

Emerging Drug Developer: S*BIO

John Carroll — Mon, 22 Sep 2008 08:48:21 -0400

S*BIO readies new venture round as it moves into Phase II

After several years of early-stage work in the oncology sphere, Singapore-based S*BIO is preparing to take the next big step in its development.

In a matter of weeks, says CEO Jan-Anders Karlsson, the developer plans to announce a new venture round of about $30 million. The Phase I study of its lead compound--an HDAC inhibitor--will wrap with new data available in October and a mid-stage study should be ready to launch next year. The company also just announced that it has started a Phase I trial of its second therapy--an oral JAK2 inhibitor.

S*BIO still has a long way to go. Like others in the cancer space, one study will lead to others as the developer explores various cancer types. The upcoming mid-stage study will be the first of several for SB939. The first Phase II data is likely to start flowing in 2010. SB1518, meanwhile, is entering a 60-patient, dose-escalating Phase I trial in the U.S. for leukemia and certain other types of lymphoma.

The developer has yet to announce the new venture round, and Karlsson wasn't releasing the list of investors, yet. He did note that a number of new European investors were preparing to back the company and would be joining the board of directors.

"We think this (venture round) will take us to the second half of 2009," says Karlsson. "With that we will come closer to Phase II data for the HDAC inhibitor and JAK2 compound (SB1518). "We'll at least have started Phase II studies. The real value inflection point probably comes in the first half of 2010, the middle of 2010, when we will have Phase II data on the two compounds."

To get to that point, he adds, the company will likely either raise a new venture round or look to "limited partnering" to supply new funds.

Depending on the data, S*BIO may opt to pursue a Phase IIb trial for solid tumors--something that Karlsson says would require a partner. If the company chooses a hematology indication, there's an option of going it alone.

S*BIO got started with the considerable support available from the Singapore Economic Development Board, which years ago started to craft a program designed to make the city-state a leader in the biopharma world. That backing (Chiron was a member of the original joint venture that launched S*BIO) has spawned a company with a vision of growing into a sizeable force of its own.

S*BIO doesn't plan to try and copy the standard biotech development model established in the U.S. and Europe, says the CEO. Instead, it has kept one foot planted in the U.S. clinical development world while eyeing a role for itself as a trailblazer in Asian markets.

"We are close to India," says Karlsson. "We are certainly close to China." And with their small molecule focus in the cancer space, "there are many opportunities for us to be a leading biotech in this part of the world."

Ultimately, says Karlsson, who joined the company in 2005, S*BIO hopes to be able to pursue "a mix of marketing ourselves and partnering. We need some risk mitigation so we don't take on all the risk ourselves."

The biotech company has about 50 people on staff, most in Singapore with a clinical development team in place in Redwood City, CA. The California operation keeps the company in the FDA's orbit while staying close to U.S. colleagues working in the development sphere.

Karlsson doesn't expect the number of staffers to grow dramatically.

"We stay as we are," he says, "moving a little from research and discovery to more competence in clinical development and regulatory."

As Karlsson notes, this is his first small venture. His development pedigree stretches back to big firms in Germany and Japan - he was executive vice president, global research of Bayer Pharma--a different world from the small team building S*BIO.

"We have a very short decision making point," says Karlsson. "We have few committees. We are very close to decisions--all small and big strategic decisions--and be accountable for it."

Emerging Drug Developer: Osprey Pharmaceuticals USA

John Carroll — Mon, 15 Sep 2008 08:59:27 -0400

Osprey Pharmaceuticals USA

Jack Anthony has been around the biotech block, and back. In addition to a 16-year stint at Baxter Healthcare, he's worked on a slate of biotech companies. And just about a year ago he was named CEO of tiny Osprey Pharmaceuticals USA.

"Osprey is my eighth biotech in 22 years," says the self-described grizzled veteran. "This is my last biotech as well."

While research work is largely concentrated in Montreal, the USA side of the business was set up in San Francisco to satisfy international investors who couldn't invest into Canada for tax reasons. Now two people work in San Francisco for the start-up biotech while seven are based in Montreal.

Osprey is working with science developed by John McDonald, PhD, who focused on the role that chemokines play in disease. These are "cytokines are produced by injured or diseased tissue when autoimmune or inflammatory diseases flare up, recruiting leukocytes to the problem." Osprey is advancing Leukocyte Population Modulators--fusion protein therapeutics that express the chemokine receptor for the chemokine produced in the diseased tissues.

Says Anthony: "The IP is whistle clean."

It's also very early stage.

"It is what we call a IB safety trial," says Barbara Finck, MD, senior vice president and chief medical officer. "It's focused on a population that has inflammatory kidney disease. When the kidney is inflamed, regardless of the cause, diabetes, systemic lupus, etcetera, the injured kidney secretes a chemokine that is spilled in the urine, which is responsible for trafficking leukocytes to the site of injury. The chemokine draws in microphages; some come in to clean up the mess and some to cause havoc by secreting additional mediators and recruiting additional leukocytes (white cells) to the already injured tissue."

Osprey's goal is to dispatch a decoy "that attaches to the macrophage. It will internalize an enzyme and immobilize the cell," preventing the damage it can do.

There's a platform potential for building a pipeline in the space.

"There are some 50 chemokines out there," notes Anthony. "We've come up with a
portfolio of 12 drugs differentiated by the chemokine so you can strike out at a lot of different diseases."

But not too fast.

"Tiny companies like us can't afford to dilute efforts no matter what," says Anthony. "We decided to pick one that the literature suggests we should take where we want to go. We can pick patients that have low levels of inflammation but who can give us data to understand it better. Now there's a complex exercise underway to figure out what the next drug is we will take out of the freezer; see if this pony can do two tricks and not just one."

This first trial will recruit fewer than 30 patients. "There could be a total of 15 patients," says Finck, "with two or three in each dose cohort. We expect to see preliminary data by the end of the first quarter or the middle of the second quarter next year."

The objective now is to establish that the therapy is safe and see if it's specific against activated leukocytes. The trial will observe any changes in key biomarkers. "If we see the needle quiver a little," adds Finck, "that will be a great day at Osprey."

"I want to get into the trial," observes Anthony. "That changes the perception of who we are. We want to get safety data tacked down so we all feel good about this biological. Then people with a franchise in the kidney area can start calling. It's all about value."

Osprey will have enough money to better explore its potential. Osprey announced an $11 million first round last week. The financing was led by Burrill & Company with participation from Novo Nordisk Biotech Fund (Novo Nordisk's internal corporate venture fund), Yasuda Enterprise Development, GeneChem Therapeutics Venture Fund, BDC Venture Capital, Inc. and Western Technology Seed Investment Fund.

But how long are they all willing to wait for the first licensing deal?

"Would I hold out to Phase II results?" asks Anthony. "That's the perfect world. But the economy is tougher; you have to sustain viable operations. I like doing partnerships. It's silly to build infrastructure. Let's do what we do well, and then hand it off to people are set up to make a run for the roses."

And along the way, if Anthony and Finck can help build the company into a biotech with 12 drugs and around 100 indications, that could be a considerable success.

"I think we'll grow," adds Anthony. "If you come back in two years you'll probably find 16 or 17 people. We need project management, alliance management. And we'd like to have a secretary, too, someday. It's all about focus, focus, focus and hold off on the extraneous stuff until you have real traction."

Emerging Drug Developer: Acucela

John Carroll — Mon, 08 Sep 2008 08:01:17 -0400

Acucela grows with one foot in the U.S., one in Japan

Over the years, Dr. Ryo Kubota has developed some keen insights into the strategic thinking taking place among large Japanese pharma companies. And that's helped him gain the backing he's needed to help grow Bothell, WA-based Acucela.

"The Japanese market is shrinking in the long term," says Kubota in a telephone interview from Japan. "The country has a diminishing population. Medical expenditures are tight. It's not a promising market in the long term. They have to be global and penetrate the U.S. market to survive global competition."

Ten years ago, most Japanese pharma companies would have been satisfied just to ink deals for the Japanese rights to a new drug, says Kubota, who has undertaken research at both Keio University in Japan as well as the University of Washington. "Nowadays, they need to have a presence in the U.S. market. Unless they can participate in U.S. commercialization, there's no real value. This is a general, recent trend."

And one that has continued to buoy the developer.

Last week Acucela announced twin collaboration deals with Otsuka Pharmaceutical for its clinical development programs: ACU-4429, an early-stage therapy for dry, age-related macular degeneration and Rebamipide, headed into a late-stage trial for dry eye. Acucela snared $5 million upfront for ACU-4429 with a $258 million schedule of milestones for a North American co-promotion deal and an unspecified amount for the development of Rebamipide with rights to negotiate a co-promotion deal for the U.S. market following regulatory approval.

A Phase I trial of 4429 should be completed this year, which will include data on the pharmacological response to the drug. A brief Phase IIa is planned for 2009 with an 18-month Phase IIb trial set to begin next year, says Kubota. If it works as expected, 4429 will stop the build-up of A2E, a toxin that plays a role in spurring AMD.

Rebamipide is much further along. Rebamipide is designed to raise the level of mucin in the tear covering the conjunctiva and cornea. By stabilizing the tear film, researchers believe it should improve the corneal-conjunctival damage associated with dry eye.

"Within two months we plan to initiate a pivotal study," says the CEO. We would like to see significant improvement in discomfort from dry eye. We're hoping to commercialize within two years, in an ideal situation."

Acucela now has the option to sign on a separate European partner or possibly continue on to commercialization alone. Says Kubota: "We don't need an amazingly large sales force."

The developer has raised $40 million from Tokyo-based SBI Investment, says Dr. Kubota. Acucela has about 30 staffers and Kubota isn't planning any major expansion anytime soon.

"We will grow a bit," he says, but not much. "I'm not interested in just expanding the organization," says Kubota, who prefers to keep the burn rate as low as possible.

"We don't necessarily care if we go public or stay private," he adds. "We want to build a fully functional biotech company with sales and marketing - a specialty pharmaceutical company."

And he expects to gain more support from his Japanese connections to push down that path.

"Japanese investors are in for the long term," he adds. "The philosophy of a Japanese company is a very different perspective, which is fortunate for us. It's helped us build self sufficiency."

Japanese companies have long been noted for their aversion to risk. "But I think Japanese pharma is becoming more and more aggressive," says Kubota. "You need to be patient in building relationships. That will pay off in the end."

It's already paid off for Acucela.

Emerging Drug Developer: Follica

John Carroll — Mon, 25 Aug 2008 08:47:18 -0400

Follica starts with a market in search of a therapy

Most biotech companies start with an interesting discovery technology or a drug development program and then go out in search of money to fund their work. But PureTech Ventures likes to put in the seed money up front, and then go in search of the right program.

"In the case of Follica, aesthetic medicine was the concept," says Daphne Zohar, the managing partner at PureTech and acting CEO of the fledgling, two-year-old biotech company. Working with a team of experts, PureTech identified several areas where there was an obvious unmet medical need and a woefully inadequate group of therapeutics approved for use. The company's scientific team concentrated on finding a non-invasive approach to fat reduction, a new approach to wrinkle removal and "everything to do with the hair follicle."

The hair follicle won. At that point the group of scientific co-founders was honed down to leading follicle experts - a group that included George Cotsarelis at the University of Pennsylvania, Rox Anderson at Harvard Medical School and Vera Price, director of the UCSF Hair Research Center.

"One day George Cotsarelis told me that he was working on something in his lab that was really interesting," recalls Zohar. "I was appropriately skeptical, but said, OK. Let's take a look at it. It's a great lab. It turned out to be extremely exciting. Potentially paradigm shifting."

Cotsarelis's epiphany had started with an experiment on wound healing when he observed hair growing in the middle of wounds.

"He tracked epithelial stem cells," says the venture capitalist. "After disruption of a certain type, the skin reverted back to a more primitive state. There's an embryonic window that opens in adult skin; pathways which are activated that are usually not activated in adult skin. By applying compounds you can push them down the direction of making hair or skin."

That insight - using an abrasive procedure on the skin and then treating it with reformulated compounds -- was enough to get Follica launched in 2006. At the beginning of this year, PureTech helped round up $5.5 million for the start-up's Series A and an $11 million round followed earlier this month. Interwest Partners was one of the original investors and Polaris Venture Partners led the second round.

Right now their money is funding a small human study which Zohar describes as "more of an investigator-sponsored trial." And the company has enough money to push the program through proof-of-concept toward an NDA - a path that's likely to take an accelerated development path that compresses the usual early and mid-stage trials into a 24- to 36-month window. An approval could conceivably be won in four to five years.

"What's nice about it," she adds, "is that even though this is based on breakthrough science, we are using existing compounds previously approved for systemic chronic use and reformulating them for topical acute use. We know these compounds are safe in people."

There's no questioning the market demand. A new therapy that could safely and effectively treat male and female pattern hair loss would swiftly seize a huge market. And Zohar says the same technology can potentially be applied to hair removal, skin pigmentation and more. But don't ask her to name the original compounds the company is reformulating for novel use - that's a trade secret for now.

Like any other venture backed biotech start-up, Follica's ultimate fate could lie in any of a number of directions.

"This is the type of company that would attract the interest of the public market," says Zohar. "It's also an exciting acquisition target." And there's a possibility that the company could be expanded to take an approved product and market it - something that Zohar agrees would call for a large sales force.

Right now, though, the Boston-based biotech is moving on with four full-time employees with plans to scale up to 10 or 12 people, keeping everything semi-virtual as it relies on outsourcing for much of the initial investigatory work.

That's the same kind of business development model that PureTech is pursuing for other therapeutic areas as well.

Says Zohar: "We have four new companies we're working on right now."

Emerging Drug Developer

Maureen Martino — Fri, 15 Aug 2008 13:25:33 -0400

Portola Pharmaceuticals

"Having been in biotech 14 years, one always needs to do two things," says Portola Pharmaceuticals CEO Charles Homcy. "One is being cautious and looking at the things outside of our control, watching the money. And the other thing that is important is clinical data. Nothing is more important than good clinical data. What we're focusing on right now is protecting the portfolio by keeping it well funded without diluting equity."

And a cash-hungry Portola is busy at work getting that data while lining up partners for some of its development programs to keep the money coming in. Article

Emerging Drug Developer: Portola Pharmaceuticals

John Carroll — Fri, 15 Aug 2008 13:12:04 -0400

Cash-hungry Portola aims at a blockbuster market

Portola Pharmaceuticals isn't cheap to operate.

When the South San Francisco-based developer announced it had completed raising $60 million in July, executives were clear that much of that cash would go to the mid-stage development of two key antithrombotic programs: Betrixaban, an oral Factor Xa inhibitor, and PRT060128. Portola researchers had already blueprinted a second Phase II study of betrixaban, looking to recruit 500 patients in a trial that would compare it to warfarin. PRT060128 is being advanced in a planned mid-stage study involving 800 patients to evaluate its chances at becoming a successor to clopidogrel, better known as Plavix.

In both cases, the company believes it is on track to emerge with a best-in-class replacement for standard therapy. At the same time, it is advancing early-stage programs: A factor Xa inhibitor antidote as well as Portola's Syk and JAK inhibitor program for inflammation, cancer and thrombosis.

And the company believes it has potential blockbusters on its hands.

"We have significant Phase II studies planned," says Charles Homcy, MD, the CEO. When they're wrapped, Portola will have data on 1,300 patients and multiple doses in each program.

Betrixaban, Portola's lead development program, is an oral anticoagulant being studied for stroke prevention in patients with atrial fibrillation as well as the secondary prevention of stroke and heart attack. The small molecule therapy also boasts a long half life, making it more appropriate for chronically ill patients and possibly releasing providers from the kind of intense monitoring associated with the use of warfarin. Getting the data to prove that the drug is effective without presenting the same risks as warfarin would open up a multibillion-dollar market.

PRT060128, meanwhile, is an antiplatelet agent being developed for thrombosis in patients with acute coronary syndrome, the prevention of cardiovascular events in patients during and following percutaneous coronary intervention, and the secondary prevention of heart attack and stroke.

These trials won't be a quick turnaround. Portola will need about 17 months to get its Phase II data back, a point that could present the developer with a unique "value-creation opportunity," says Homcy. "The money in the bank we have would not take us to that point and leave $40 to $50 million in the bank. We do have a requirement to raise more money, which can be met. In addition, we have two other programs which are eminently and imminently partnerable."

Homcy never takes his eye off the company's bank balance.

"Having been in biotech 14 years, one always needs to do two things," he says. "One is being cautious and looking at the things outside of our control, watching the money. And the other thing that is important is clinical data. Nothing is more important than good clinical data. What we're focusing on right now is protecting the portfolio by keeping it well funded without diluting equity. If we keep control of those two issues," he adds, then Portola will be able to explore a variety of options like partnering and a possible IPO at some point.

In the meantime, Portola has found the kind of deep pocket backers it needs to fund the work through proof of concept. Portola raised $137 million in its first three rounds of venture capital as well as additional equity financing. The D.E. Shaw group, Adage Capital Management, BBT Capital Management/Apothecary Capital, Janus Capital Group and PAC-Link BioInvestors joined a group of existing investors like Abingworth and Alta Partners to raise the latest $60 million.

They're backing a company with 74 staffers, which includes 12 biologists and co-founder David Phillips, PhD, an expert in Factor Xa. Phillips and Homcy worked together at Cor Therapeutics before it was bought out by Millennium Pharmaceuticals, and continued together for some time on the R&D side of Millennium before launching Portola in 2003.

And Homcy doesn't expect to add many more employees as he steers Portola through the mid-stage straits. That's not in the budget.

Emerging Drug Developer: Tetraphase

John Carroll — Mon, 11 Aug 2008 09:21:40 -0400

Tetraphase readies its move into the clinic

Tetraphase Pharmaceuticals' roots go back to Andrew Myers' laboratory at Harvard, where the chemist--who chairs the department of chemistry and chemical biology--developed a synthetic process for creating tetracycline antibiotics. By altering the chemical composition of the molecules, Myers was able to change their therapeutic potential--creating an engine for novel drug discovery work.

The implications attracted the attention of Mediphase Venture Partners, which decided to create a platform company with the intellectual property it licensed from Harvard. The venture capital group teamed up with Fidelity Biosciences, Flagship Ventures, Skyline Ventures and CMEA Ventures on a $25 million Series A in late 2006. And just days ago the Watertown, MA-based company gained $15 million in the second tranche of that round.

Over the past 18 months "we've produced over 400 different analogs, and the majority are a novel structure you can only do with a synthetic approach," says Guy Macdonald, who was appointed CEO at the beginning of this year. "We're making structures that have never existed before."

Over the next nine to 12 months, Tetraphase plans to do IND-enabling toxicity studies. And McDonald says that the latest infusion of capital is enough to get through a Phase I trial on a single program. But the biotech also wants to advance another program toward an early-stage trial, "and that could change the timeline."

Initially, Tetraphase will pursue a familiar path among the small biotechs pursuing antibiotic programs, focusing on new therapies to fight drug-resistant infections. But along the way, Tetraphase will be working to determine if these novel structures could be used to target ailments outside the infectious disease arena. The biotech feels that its technology could play an important role in inflammation and cancer, where tetracycline-class therapeutics have demonstrated potential in anti-angiogenesis.

"Over the last 10 years you've seen big pharma moving out of the drug discovery path in infectious disease," says Mcdonald. "More recently, though, a large number of biotech companies have been working in antibiotic development." And big pharma companies like Novartis and Forest Laboratories have been stepping back in, licensing programs once they get past Phase I or Phase II.

At this stage of the game, Tetraphase is focused primarily on chemistry work. Twenty out of 25 employees at the company are chemists. And CRO chemists in China are supplementing the work as well, part of a broad strategy to outsource a significant amount of the work in order to keep the biotech's head count low.

Mcdonald spent most of his career at Merck--22 years--before moving on to Idenix. And after helping build that company to 300 workers as executive vice president and COO, setbacks on the chemistry side of the business persuaded him to refocus his career and move on.

Now he has a three-year game plan with several key milestones to hit: Bring Tetraphase's first program to the clinic, advance a second through toxicology studies and explore novel uses of the technology outside of infectious diseases.

"I really want to demonstrate that we have a platform here and that we're not a one tetracycline antibiotic company," says the CEO. "Then we can demonstrate a high level of value in the platform with three INDs in less than 5 years."

After that the startup can get a better idea of the best way to go forward, comparing the advantages of a partnering strategy while growing the company and considering the potential of an IPO or a potential acquisition.

But the company's ultimate fate lies past Mcdonald's three-year horizon. For now, it's one step at a time.

Emerging Drug Developer

Maureen Martino — Mon, 04 Aug 2008 09:53:18 -0400

Cytochroma

The business case for Cytochroma is built around the shortcomings of two lead therapies for hyperparathyroidism in patients with chronic kidney disease; Hectorol and Zemplar.

"These two products properly control hyperparathyroidism in 10 percent of treated patients," says Cytochroma CEO Charles Bishop, PhD. "There's an enormous opportunity for better therapies for the disorder."

Bishop is in a good position to know. He was a senior manager at Bone Care and helped get the NDA approval for Hectorol. Later, he co-founded Proventiv Therapeutics, which was sold to Cytochroma two years ago--a deal which provided two of its top three development programs. And Cytochroma is now moving into a critical phase, providing the data to prove the biotech is on the right path to better treatments. Report

Emerging Drug Developer: Cytochroma

John Carroll — Mon, 04 Aug 2008 09:38:04 -0400

Cytochroma plans to grow as it advances vitamin D work

The business case for Cytochroma is built around the shortcomings of two lead therapies for hyperparathyroidism in patients with chronic kidney disease; Hectorol and Zemplar.

"These two products properly control hyperparathyroidism in 10 percent of treated patients," says Cytochroma CEO Charles Bishop. "There's an enormous opportunity for better therapies for the disorder."

The company is advancing three therapies in the clinic: CTA018 and CTAP201 for secondary hyperparathyroidism and CTAP101 for the treatment of vitamin D insufficiency.

The first set of Phase II data should come in around the middle of next year, says the CEO. The first safety and efficacy trial lies ahead for 201 and 101 should be in a mid-stage trial by the end of the year.

The biotech's work has attracted a long lineup of financial backers as well as its first development partner. Mitsubishi Tanabe Pharma Corporation led the $45 million (Canadian) Series C, supported by Vengrowth Advanced Life Sciences Fund, Caisse de Dépôt et Placement du Québec, Novo A/S, Canadian Medical Discoveries Fund Inc., T2C2/Bio 2000 Limited Partnership, GrowthWorks Canadian Fund Ltd., BDC Capital Inc., and VentureLink Brighter Future Fund Inc.

On the same day the Series C was announced, Mitsubishi Tanabe and Cytochroma heralded a $105 million (Cdn) licensing pact--including both an upfront payment and milestones--outlining a joint promotion deal for the U.S. as well as Asian rights for 018.

Cytochroma is expanding its staff to advance its mid-stage work. By the end of this year, says Bishop, the company will likely grow from its current staff of 45 to about 75. Most of these new workers will be engaged in clinical and product development, with some regulatory experts added to the mix as they start to get closer to late-stage negotiations with the FDA. And later, adds Bishop, Cytochroma plans to build a sales team to ramp up commercialization efforts--a team that could potentially field a number of new therapies.

While 201 and 101 were both acquired in the buyout of Proventiv, 018 was in-licensed from Johns Hopkins along with a significant lineup of additional compounds to explore.

"We have a portfolio of 225 vitamin D compounds in-licensed from Johns Hopkins," says Bishop. "That portfolio will provide this company with a formidable pipeline."

In an increasingly hot field.

The sun provides a free source of vitamin D, but there's been a growing body of literature that links insufficient levels of the steroid hormone vitamin D turns into in the body with a long list of ailments, including cardiovascular disease and many cancers. (You can find a recent Wall Street Journal report here.)

"You see so much in the published press about vitamin D and increased cancer risk," says Bishop. "Cytochroma is really well positioned by virtue of our vitamin D technology. There's lots of enthusiasm to drive additional products and an enormous opportunity."

Whether the company goes on to pursue its development work independently or gets bought out by a larger company pushing into the same field won't be determined for some time. But the CEO's job is to keep both eyes open to the best opportunity to boost shareholder value.

"All of us are aware of the stats of what happens to companies like Cytochroma. Our intention is to drive value for shareholders," says Bishop.

Emerging Drug Developer: Synosia Therapeutics

John Carroll — Mon, 28 Jul 2008 09:15:06 -0400

Synosia relies on relationships to grow fast

Back in 2005, Synosia Therapeutics was little more than a gleam in a venture capitalist's eye.

Bradley Bolzon, an experienced biotech player and an accomplished dealmaker with Roche, had gone on to become a partner at Versant Ventures. Several years ago he reached out to an old colleague from Roche days, Ian Massey, a 30-year biotech veteran and the senior vice president of research and preclinical development for Roche Palo Alto.

"Brad was in the process of setting up a company," says Massey, who earned a doctorate in organic chemistry at Oxford. "I joined and brought a number of compounds from Roche." An A1 round of $2.5 million to prime the pump was swiftly followed by an A2 round of $30 million. And today, Synosia has a portfolio of six clinical-stage therapeutics, four of which are either already in a mid-stage trial or ready to begin one.

Synosia built that pipeline through in-licensing pacts with a trio of companies: Roche, Novartis and Syngenta. And to keep their relationships close, Synosia has an office in Switzerland--where the CFO and chief business offer are located--as well as Palo Alto, CA, where Massey and others are based.

Four of the six compounds Synosia has in clinical development came from Roche, including SYN-115 for Parkinson's and SYN-117 for cocaine dependency and post traumatic stress disorder. Last week Synosia announced that it would conduct a mid-stage trial of SYN-117 for PTSD with $1.4 million of funding from the Department of Defense.

Novartis provided Synosia's most advanced program, an epilepsy drug--Rufinamide (SYN-111)--which is now in Phase IIb for anxiety.

"The mechanisms associated with these compounds have opportunities and applications in a number of different indications," says Massey.

It's unusual for a small biotech - Synosia has only 19 staffers--advance four compounds into Phase II in such a short period. But by outsourcing some key R&D work, Massey says the company should be able to stay lean and mean.

"It was always the plan," he adds about Synosia's multiple development programs. "It's important to be able to have multiple shots on goal. The plan was to get access to compounds for which there was clinical experience and explore in clinical studies, using some of the new imaging tools available to help demonstrate mechanisms of action in humans."

There's no platform technology for identifying new compounds, and none in immediate sight.

"I have to say that there are a lot of valuable compounds sitting on the shelves of pharma companies that can be transformed into successful drugs," says Massey. "Obviously, there are major advantages getting access to compounds that have gone through a development program, where you have clinical data. You know the attrition rate of compounds out of discovery."

And pharma companies are not reluctant to bring in a biotech company to advance a prospect that's languishing on a corporate backburner.

"Pharmaceutical companies can't do everything they want to do," says Massey. "There's competition between different therapeutic areas. My sense is that the hurdles for CNS are higher than in other therapeutic areas. It's important to use the newer tools now available, imaging tools to look into the brain and see what the drugs are doing to the brain." Not having those tools earlier "hampered development of compounds."

Synosia will start to get a round of mid-stage data in the first half of next year. That could help lay the groundwork for a licensing deal for Rufinamide's anxiety indication - a mass market that would need a commercialization partner able to bring a large sales effort together. A drug like 117, though, could eventually be marketed by a small sales force fielded by Synosia. And that would help Synosia advance on its own.

Says Massey: "I personally would like to see the company move forward as an independent company, bringing forward compounds in psychology.

"We anticipate we will bring additional compounds in through in-licensing," adds Massey, "and some discussions are ongoing. We are looking at one additional opportunity at the moment and chances are we would have another opportunity come into the portfolio this year."

Versant Ventures, Abingworth Management, 5AM Ventures and Novo A/S are backing the company. Novo led the A2 round. Sometime in the next 12 months Massey expects they'll all have a chance to participate in a Series B, though he was reluctant to define just how much money Synosia will be looking for.

Emerging Drug Developer: VLST

Maureen Martino — Mon, 21 Jul 2008 08:51:37 -0400

VLST

Some biotechs thrive best outside the glare of public attention. And VLST, a fledgling graduate of Seattle's Accelerator Corp., has been using its quiet time to line up its staff and complete preclinical work in preparation for its shift into clinical development.

"When we completed our Series B (a $55 million round announced in mid-2006), we took down $20 million in the first tranche and set about doing a couple of things," says CEO Martin Simonetti. "One was moving our lead program forward as rapidly as possible. At that point we had an early-stage discovery program. We also put a team in place and made some key hires in the last two years."

From late 2005, when Simonetti joined the company, VLST grew from seven to 42 employees. And a key co-founder, Craig Smith, a co-inventor of Enbrel, was replaced by a new chief scientific officer. Article

Emerging Drug Developer: VLST

John Carroll — Mon, 21 Jul 2008 08:32:13 -0400

VLST readies itself for a shift into the clinic

"That's somewhat the beauty of being private," says CEO Martin Simonetti, a veteran of Dendreon, where he was CFO. "We've been focused on several things over the last two years.

"When we completed our Series B (a $55 million round announced in mid-2006), we took down $20 million in the first tranche and set about doing a couple of things," says Simonetti. "One was moving our lead program forward as rapidly as possible. At that point we had an early-stage discovery program. We also put a team in place and made some key hires in the last two years."

From late 2005, when Simonetti joined the company, VLST grew from seven to 42 employees. And a key co-founder, Craig Smith, a co-inventor of Enbrel, has just been replaced by a new chief scientific officer.

"We just hired Paul Carter from Seattle Genetics and Paul really fits in beautifully with our culture and technology," says Simonetti. "His experience in protein engineering and antibody development fits nicely with our platform."

Before moving to Seattle Genetics, Carter had been director of research, antibody technologies at Amgen. He played a role in the development of Herceptin and was credited as co-inventor of an anti-IL-4 receptor antibody.

VLST's platform is still in the preclinical stage, focused on inflammatory and autoimmune disorders like rheumatoid arthritis, Crohn's, multiple sclerosis, lupus and diabetes.

That's a crowded field. But VLST believes that its work in viral factors has identified a lead therapy that can modulate immune-complex mediated inflammation. And if it can make its case, the same therapeutic approach could be successful against a variety of ‘big' autoimmune disorders.

Last May VLST took its second tranche from the Series B, a $15 million infusion that will take the company "to the end of next year," or perhaps a little beyond that stage. The money has come from a lineup of investors that includes Texas Pacific Group Ventures, MPM Capital, ARCH Venture Partners, OVP and Amgen Ventures.

"I'd expect us to have some Phase I data and be focused on what indications we may move into with Phase IIa," Simonetti adds about the company's timeline.

"Now that we've got our core infrastructure in place, our focus is two-fold: moving the lead program forward to an IND in the first quarter of next year" and advancing the most promising preclinical candidates to late-stage preclinical, ready to go into the clinic, says the CEO.

Simonetti believes the company's best hope for further development lies in advancing its core expertise in-house, outsourcing some development work and eventually finding a commercialization partner to work with. The biotech has another $20 million it can tap from its Series B, with other potential revenue to be had from partnerships and possibly the capital markets, depending on how public markets are performing when the company is advanced far enough to gain attention.

VLST still has a long way to go before it sees proof-of-concept data. But when that time arrives, the data will speak loudly about VLST's future in drug discovery.

Emerging Drug Developer: CoLucid

John Carroll — Mon, 14 Jul 2008 08:20:26 -0400

CoLucid helps define lean and mean in biotech

A roster of new biotech companies has sprung up recently that relies on a virtual business model to keep costs down as they advance therapies to proof of concept. But CoLucid Pharmaceuticals may well set the pace for what qualifies as lean-and-mean these days.

There are only four full-time employees at the company, says CEO James White, PhD. Even if you combined all the part-timers, the payroll would still add up to only 10 full-time staffers. And rather than rent a headquarters space and bring in talent from around the country, Durham, NC-based CoLucid's approach has been to let its people stay put, using all the communications technology at their disposal to keep people connected, coordinated and focused on their projects.

Think low overhead.

"Most of the money," says White, who calls Boston home, "is going to the science."

CoLucid got its start when Eli Lilly put a portfolio of development programs up for licensing in 2005. One of those became COL-144, a migraine therapy which became the lead development program of the fledgling biotech.

"It all has to do with the formulation," explains White. "When Lilly began the program they studied it intravenously in Phase I. That's what we inherited." The advisory board felt that the company's best start was to continue the IV program, study side effects and efficacy in a European study and then switch to an oral formulation. COL-144 selectively targets 5HT1F receptors expressed in the trigeminal nerve pathway.

"We saw very good results from that study," says White, "and that encouraged us to complete development. We have just completed a Phase I in oral formulations with very good safety and the same blood levels at oral as in IV."

The key is to achieve a better therapeutic effect than triptans - which have a similar mechanism of action -- without producing the same cardiovascular side effects. "This approach should allow us to relieve migraine pain without having coronary arteries narrowed," says White.

The plan now is to get through Phase II later this year with a tablet that can replicate the same positive data seen in the IV study. That study should get underway by the end of this year or early next and will take four to six months to complete.

There's also a preclinical candidate for the promotion of wakefulness - a stimulant the company believes can work without any addictive side effects - that's scheduled to start Phase I early next year. That candidate is the product of a chemistry platform that CoLucid licensed that holds the promise of producing new drug candidates - delivering therapies to the brain with multiple therapeutic effects on the central nervous system -- as the company takes root and expands.

CoLucid was founded by Pappas Ventures, which joined a $25 million Series B round at the beginning of July that included Domain Associates, Pearl Street Venture Funds and Triathlon Medical Ventures and was led by Care Capital.

That money takes the company to the doorstep of a Phase III trial on its lead program and through Phase I for its two follow-up programs. From there, CoLucid has the potential to forge a partnership deal for COL-144.

"We certainly are interested in talking to several people about the potential to partner," says White. After that, if the IPO market still looks tight, there's also the potential to go to a Series C round and continue to advance the science themselves.

But don't look for any sudden influx of new recruits. The virtual model has a ways to run at CoLucid.

"It works very well from preclinical through Phase II," says White about the business model. "That's the sweet spot where this can work most efficiently. You can cut to the chase, find the best people happy living where they are, working on an exciting program."

It doesn't really matter these days that the CEO is in Boston, a handful of top executives are scattered around the country, a trial takes place in Europe or the SAB is scattered around the world, says White.

The virtual model "has allowed us to rapidly get the best possible team together."

Now it all comes down to the data they produce.

Emerging Drug Developer: Gemin X Pharmaceuticals

John Carroll — Mon, 07 Jul 2008 08:09:54 -0400

Gemin X Pharmaceuticals

Over the past 20 years, Glenn Gormley, M.D., Ph.D., rose to a high altitude in the world of big pharma drug development. There were stints at AstraZeneca and Merck capped by a role as global head of clinical development and medical affairs for Novartis.

Now, though, he's made the leap from top executive at big pharma to biotech entrepreneur, taking the top job at Gemin X Pharmaceuticals just weeks before a third venture round reaped $38 million, bringing the company to more than $90 million in total money raised as it heads through the mid-stage point on its lead therapy. Article

Gemin X Pharmaceuticals

John Carroll — Mon, 07 Jul 2008 07:58:58 -0400

Pharma development chief takes on role of biotech entrepreneur

"For a long time I have been interested in operating as CEO of a company and moving into a smaller organization where I could have an impact on setting the direction," Gormley tells FierceBiotech. And at 65 staffers, Gemin X in Malvern, PA - the company also has operations in Montreal -- fit the bill perfectly.

He liked the executive team and staffers he met early on. Gormley also appreciated the biotech's pipeline, with a lead compound in mid-stage trials and a second compound (GMX1777, in-licensed from Leo Pharma) "in late Phase I" which has shown anti-tumor activity. And there were good preclinical programs in place as well.

"The third characteristic was the potential of the company, its philosophy," says Gormley. "This is a company we want to grow; make it a leader. We want to deliver products to patients who need them, and our goal and strategy is to make obatoclax successful."

Obatoclax (GX15-070) is a small molecule now in a mid-stage trial to determine its usefulness as a single agent in combating acute myelogenous leukemia in the elderly.

When people hit their 70s and 80s, says Gormley, "AML is very difficult to treat. Obatoclax can fill that void and make a big difference."

Obatoclax, which was discovered at Gemin X, is intended to restore natural apoptosis. "Cancer cells often escape cell death by the over-expression of the Bcl-2 family of proteins," explains Gormley. "There are five. Obatoclax inhibits all of the known family of Bcl-2 proteins.

"We believe that can work as a standalone therapy."

A second indication is being pursued with obatoclax in a combination therapy for non-small cell lung cancer. And there's a third indication in mantle cell lymphoma, where patients have an approved product but resistance occurs in the expression of Mcl-1, "and obatoclax is quite potent at inhibiting Mcl-1. We're going to see if a combination therapy can prevent that resistance."

I think that's a pretty significant set of studies."

Caxton Advantage Life Sciences Fund and Caxton Global led the recent venture round, with Sanderling Ventures, H.I.G. Ventures, CDP/Vantage Point, ProQuest, Merlin BioMed Group, HBM Partners, Canadian Medical Discoveries Fund, Ontario Teachers' Pension Plan Board, SoftBank Life Science, Business Development Bank of Canada, Solidarity Fund QFL, and Pinnacle Bioventures all participating.

The money from the Series C "allows us to complete the programs we need to get to a point where we can see the efficacy of the drug." That would help set up new venture rounds -- if needed -- and raises the possibility of structuring a lucrative partnership.

"A strategic partnership with big pharma would be useful."

Just don't ask for a timeline.

Says Gormley: "We won't define how far that takes us out."

Like a lot of small biotech companies, Gemin X's ultimate fate will be determined not just by the data that's generated in clinical trials but by the state of the public market and the competing hunger for new mergers and acquisitions.

"I think growing as a public company is an option," says Gormley. "It will depend on the marketplace and we will need to assess the conditions of the marketplace." But for the executive team to be successful, says the newly minted entrepreneur, management would have to be able to present various options for investors.

Emerging Drug Developer: Immune Design

Maureen Martino — Mon, 30 Jun 2008 08:39:24 -0400

Immune Design

Boom times in the vaccine industry have helped breed a new generation of vaccine development start-ups, and Seattle-based Immune Design believes it can be one of the most successful. The biotech company combines research undertaken by Steven Reed on small molecules and the viral vector work of Nobel laureate David Baltimore in a company that is advancing a new approach to adjuvants and vaccines.

And as we see in so many biotech start-ups, a venture capital player helped put it all together. Article

Emerging Drug Developer: Immune Design

John Carroll — Mon, 30 Jun 2008 08:31:06 -0400

Immune Design starts recruiting for new research

Up until a few years ago, vaccine development was in a torpor.

Margins were slim, the manufacturing process difficult and the upside often hard to make out.

New technology and a host of buyers around the world anxious to stock up on vaccines changed all that. Just last week we reported that Sanofi-Aventis is looking to invest $6 billion in vaccine production and expects its market in the field to double in eight years.

Boom times have helped breed a new generation of vaccine development start-ups, and Seattle-based Immune Design believes it can be one of the most successful. The biotech company combines research undertaken by Steven Reed on small molecules and the viral vector work of Nobel laureate David Baltimore in a company that is advancing a new approach to adjuvants and vaccines.

And as we see in so many biotech start-ups, a venture capital player helped put it all together.

"The origin was really from the Column Group," says Reed. "Rick Klausner (a partner at Column and the former director of the National Cancer Institute) knew about the work I was doing in adjuvants and put that together with the work that David was doing at Cal Tech," says Reed. He saw that the two technologies worked synergistically, focused around a central theme of targeting and activating dendritic cells to spur a strong immune response.

Marrying their work in a new company gives Immune Design a shot at creating a platform company with the technology that could generate a more potent immune response. If they're right, they can improve the performance of existing vaccines while developing their own pipeline of new and better vaccines.

It doesn't hurt that the company is based on impressive academic work. Reed is the founder of the Infectious Disease Research Institute and former CSO of Corixa--so he has experience in both applied and basic research. In addition to Baltimore, the roster of founding scientists includes Dr. Lili Yang of Cal Tech and Dr. Pin Wang of University of Southern California.

That lineup of talent drew three key venture players to back the company. The Column Group incubated the company and teamed with Alta Partners and Versant Ventures to contribute to the first round of $18 million.

But don't look for an overnight success story here. Reed's timeline includes three years to get to an IND. To get to that point, Immune Design has to quickly ramp up from a skeletal crew of three to a development company with 30 employees.

Reed is telling investors that their $18 million will get the company through Phase II on a lead program with preclinical programs advanced to the IND stage. No doubt he's also telling investors more than he's willing to let on to FierceBiotech. The company is concentrating on "viral diseases and other infectious diseases," he allows. And it will be active in HIV and pandemic work, in addition to other disease categories

"I should emphasize that when we say vaccines, that's broad," notes Reed. "We're really talking about therapeutics. Our first indications in molecules will be vaccines, the viral vector is in therapeutics."

But the CEO is clearly leery about giving away too much about the company's plans.

"We're in the process of finalizing licenses," he says by way of explanation. And even with only three staffers on board, Immune Design is already in the earliest stages of partnership talks. After a year in operation, says Reed, you should see deals in place.

"We really want to be a research-focused company, and these days early-stage clinical trials are included in the research phase." The biotech's focus will stay on research and clinical development, he adds, but not through the approval process. For that, he says, Immune Design will need to partner.