Biotech VCs back startup Allena Pharma in $15M A round

Alexey Margolin and Bob Gallotto are getting their biotech band back together. Allena Pharmaceuticals, their latest startup, has nailed down $15 million in a Series A round of financing led by a trio of venture firms--Bessemer Venture Partners, Frazier Healthcare and Third Rock Ventures. With money in the bank, the startup plans to develop oral protein drugs that are made to stay in the gut and treat disorders related to kidney function and the urinary tract.

Margolin and Gallotto's last company, Alnara Pharmaceuticals, also researched oral protein drugs. Eli Lilly ($LLY) snapped up Alnara for $180 million upfront in July 2010, primarily to grab control of the firm's lead drug, liprotamase, an oral protein treatment for replacing pancreatic enzymes lacking in patients with cystic fibrosis and other disorders. Bessemer, Frazier and Third Rock were all backers of Alnara, which spent $30 million to $35 million of the $55 million it raised prior to the deal with Lilly, providing a nice return for its venture investors, Margolin said.

In April, the FDA denied Lilly's bid to gain approval of liprotamase for patients with cystic fibrosis. The Indianapolis-based drugmaker plans to try again to get a market green light for the drug.

The liprotamase experience will serve Newton, MA-based Allena's founders well. In developing the drug, for example, Margolin and his team learned how to produce microbial enzymes that can remain stable in the body. At Allena, the idea is to deliver microbial enzymes into the gut, where they can degrade toxic metabolites that lead to conditions such as kidney stones and gout. The group is also interested in rare or orphan diseases that can be combated with the enzyme therapies, much in the way liprotamase was developed for patients with the genetic disease cystic fibrosis but could also treat additional patients with pancreatitis.

In a sense, Allena gives its founders a chance to wrap up some unfinished business from their last company. Alnara got started in 2008 to advance oral protein drugs for metabolic diseases, but the focus became liprotamase in a hurry after the compound was acquired through a deal with CF Foundation in early 2009. Liprotamase was actually one of Margolin's projects when he worked as chief scientist at Waltham, MA-based Altus Pharmaceuticals, which gave up rights to the program to the CF Foundation amid financial strife and eventually went bankrupt.

"Alnara really became a liprotamase company," Gallotto, Allena's chief operating officer, told FierceBiotech. "We think we're in a much better position now than we were in 2008 to look at different therapeutic applications of this non-systemic delivery approach. We really have three or four ideas that we're looking at now, and hopefully in the not-too-distant future, based on our work in animal models, we'll select one lead compound to bring forward."

- here's the release