Welcome to the latest edition of our weekly EuroBiotech Report. The second week of 2015 showed there is still a pool of European biotechs with IPO ambitions. Having unveiled plans for an £80 million ($121 million) listing on AIM this week, the AstraZeneca ($AZN)-partnered Redx is set to be among the first biotechs of the year to test the United Kingdom market. PolyPid is looking stateside for its IPO. And the likes of EffRx Pharmaceuticals and Cortendo are evaluating their options. Alcobra ($ADHD) returned to public investors for $27.9 million in a bid to resuscitate the ADHD program that sunk its stock last year. UniQure ($QURE) licensed its gene therapy IP to an amyotrophic lateral sclerosis (ALS)-focused biotech. The Irish government contributed to a life science VC fund for the second time in 8 months. Politicians hope the €15 million investment in Fountain Healthcare Partners' fund will stimulate economic growth. And more. Nick Taylor (email | Twitter)
1. Irish gov helps Fountain Healthcare Partners raise €85M life sci VC fund
2. Redx to expand into immunology using cash from £80 million IPO
3. Alcobra raises $28M to fund resuscitation of ADHD program
4. ALS entrepreneurs add uniQure tie up to multi-front fight against disease
5. PolyPid dusts off plan to raise $20 million in Nasdaq IPO
And more >>
The Irish government is continuing with its efforts to stimulate growth by contributing to life science venture capital funds. Fountain Healthcare Partners is the latest VC shop to benefit from the strategy, pocketing €15 million ($18 million) from the government for its latest €85 million fund.
|Irish jobs minister Richard Bruton|
Dublin, Ireland-based Fountain will allocate more than 75% of the cash--which could total €125 million by its final close--to European biotechs, with U.S.-based companies receiving the remainder. Ireland is hoping to hoover up most of the cash. Jobs minister Richard Bruton expects Irish companies to claim 70% of the money, the Irish Examiner reports, and go on to create 1,000 jobs in the coming years. Fountain wants to strike deals with up to 15 companies, two of which are already decided upon.
Hayward, CA-based Chrono Therapeutics bagged some of the cash for its digital transdermal drug delivery platform, while Irish-German biotech Innocoll ($INNL) also received investment. Innocoll has several products in late-phase development, including postoperative pain treatment XaraColl. European and U.S. developers of specialty pharmaceuticals, biologics, medical devices and diagnostics are all candidates to receive the remainder of the fund.
The €15 million investment from Enterprise Ireland marks the second time in 8 months that the government agency has contributed to a life science VC fund. In May, the agency gave €20 million to Lightstone Ventures' new fund. Both deals are part of the same strategy. "International evidence shows that the presence of a dynamic seed and venture industry is crucial. … We must increase the availability of venture capital to facilitate company growth and job creation," Bruton said in a statement. - read the Fountain release, government statement and Irish Examiner article
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|Redx CEO Dr. Neil Murray|
Redx Pharma is planning an £80 million ($121 million) listing on London's AIM. The Liverpool-based, AstraZeneca ($AZN)-partnered biotech hopes to raise £20 million from public investors to create a new subsidiary focused on immunology and advance its existing pipeline of oncology and infectious disease candidates.
The listing is an early test of British investors' willingness to back early-stage biotechs in 2015. None of Redx's 13 development programs has reached the clinic yet. Only four of the programs have achieved preclinical proof-of-concept. With commercialization still a distant dream, Redx is focusing its pitch to investors on the upfront and milestone payments it has secured by partnering with AstraZeneca, Pierre Fabre and the National Health Service.
Redx will use some of the proceeds from the IPO to advance the most promising of its partnered drugs to a stage at which they start generating significant milestones. "The placing and admission to AIM is another important milestone in Redx's development," Redx CEO Neil Murray said in a statement. "It will strengthen the business and support our objectives of progressing our programmes and achieving early profitability."
The rest of the cash will go toward a new subsidiary. Redx has already been split into two units--the Liverpool-based Redx Anti-Infectives and the Alderley Park-based Redx Oncology--and now plans to add an immunology research team. The government is contributing grant funding to the subsidiary through its Regional Growth Fund, a £3.2 billion initiative to stimulate economic growth and job creation. Redx currently employs 140 people. - read the statement and the FT's take
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|Alcobra CEO Yaron Daniely|
Last year did not go well for Alcobra ($ADHD). While other stocks rode the wave of positive biotech sentiment, Alcobra saw its stock sink almost 80% in the calendar year after it compounded a Phase III failure by trying to apply a positive statistical sheen to the data. Now, the biotech has raised $27.9 million (€24.0 million) to finance the resuscitation of its ADHD candidate MDX.
The drug was dealt a blow in October when Alcobra reported it failed to outperform a placebo in a Phase III trial--unless data from four "extreme" responders were stripped from the analysis. Tel Aviv, Israel-based Alcobra isn't ready to give up on MDX though. The plan now is to talk to the FDA, agree on a second Phase III trial and get the study underway in the second quarter of 2015. Data are expected in the first half of 2016.
Alcobra isn't alone in seeing enough positive signs in the wreckage of its last Phase III trial to justify trying again--Piper Jaffray analyst Charles Duncan reached the same conclusion--and thinks it can learn from what went wrong last time. "The design of this trial will incorporate lessons learned from the first Phase III such as improved powering assumptions, duration of treatment, frequency and duration of trial visits and patient selection and enrichment methods," Alcobra said in its filing.
Whether these changes are enough to tip the "positive trend" Alcobra saw in its last 300-person trial into statistically significant results remains to be seen. - read the release, regulatory filing and Globes' take
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|Robbert Jan Stuit|
The entrepreneurs behind an amyotrophic lateral sclerosis (ALS)-focused biotech, investment fund and DNA sequencing initiative have enlisted the support of gene therapy specialist uniQure ($QURE). Amsterdam-based uniQure has granted the entrepreneurs' biotech--Treeway--an exclusive license to its gene therapy IP in ALS.
UniQure's AAV5 viral vector and GDNF (glial cell-derived neurotrophic factor) intellectual property are at the heart of the deal. Fellow Dutch biotech Treeway hopes to use the IP to develop a therapy that can fix the faulty genetics that cause ALS, potentially resulting in a permanent cure for the disease. Treeway will handle preclinical and clinical development. UniQure will provide manufacturing support. And both companies will jointly handle commercialization if a product makes it to market.
The precedent set by uniQure's lipoprotein lipase deficiency gene therapy Glybera--which carries a €1.1 million ($1.3 million) price tag--suggests an ALS gene therapy could generate sizable sales. But Treeway's interests go beyond money. Co-founders Bernard Muller and Robbert Jan Stuit are both diagnosed with ALS and have set up a string of ventures to tackle the disease. The pair are also behind DNA sequencing initiative Project MinE and efforts to create a €100 million ALS VC fund.
Gene therapy development is among the longer-term bets. Treeway's lead therapeutic candidate is TW001, a reformulation of an undisclosed drug. Late last year, the European Medicines Agency granted orphan drug status to TW001, which Treeway hopes to bring to market in 2017. Further down the pipeline are a clutch of candidates that will be more expensive and time-consuming to develop, but carry the potential to control or even cure ALS. - read the release
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PolyPid is going to Nasdaq. Having decided against going through with a planned IPO late last year, the Israeli orthopedic drug developer has refiled the paperwork to raise $20 million (€17 million) from public investors.
The company needs the cash. PolyPid had $4 million in the bank at the end of June, a sum it deemed insufficient to see it through to the middle of 2015. Pocketing $20 million from an IPO would end PolyPid's near-term money worries and give it the financial clout to advance its bone graft products toward approval. PolyPid has earmarked $7.5 million of the IPO funds for clinical development and regulatory filings of its grafting products, which release an antibiotic while also filling bone defects.
A further $2.5 million will go toward development of D-PLEX, a reservoir of antibiotics PolyPid sees being used to prevent surgical site infections. First, PolyPid must persuade investors to back its fairly modest IPO, the terms of which are very similar to the listing the company backed away from late last year. PolyPid hopes to raise up to $22 million in a flotation that will value the company at around $80 million.
The IPO will give an early indication of the reception Israeli biotechs might get on Wall Street in 2015. Last year Israeli biotechs raised a record sum of money from U.S. public investors--even though many companies fell short of their fundraising goals--and more businesses are assessing their options. Check-Cap, EndoChoice and TheraCoat are all reportedly considering listing in the U.S., while Mapi Pharma may join PolyPid in dusting off its shelved IPO plans. - read the F1/A and Globes' coverage
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Cortendo set the terms for a $27.5 million (€23.5 million) private placement. The Swedish biotech--which recently dropped plans to list in Norway in favor of a U.S.-focused strategy--will use the cash for a late-phase trial of its Cushing's syndrome drug. FierceBiotech
Kymab entered into a collaboration with Dr. Stephen Gillies, the founder and CEO of Provenance Biopharmaceuticals. Gillies is to help Kymab with the development of immunocytokine-based drugs. Release
A pair of European biotechs unveiled big news on the eve of JP Morgan. Switzerland's AC Immune sold Johnson & Johnson ($JNJ) the rights to its Phase Ib Alzheimer's drug for up to $509 million (€434 million) in milestones. News of the deal coincided with an announcement about Convergence Pharmaceuticals. Biogen Idec ($BIIB) agreed to buy the GlaxoSmithKline ($GSK) spinout for up to $675 million. AC Immune | Convergence Pharmaceuticals
Dr. Vicki Sato resigned from the board at Galapagos (AMS:GLPG) to avoid potential conflicts of interest. Sato is also on the board at Bristol-Myers Squibb ($BMY). Release
Danish biotech Orphazyme pocketed €20 million ($24 million) to finance its rare lysosomal storage disorders development programs. Novo Nordisk's ($NVO) venture wing was among the backers. FierceBiotech
Barcelona, Spain-based Laboratorios Esteve struck a deal with Mundipharma International and Purdue Pharmaceuticals that could net it $1 billion (€825 million) in milestones. The deal covers the development of pain medications. Release
EffRx Pharmaceuticals raised CHF 2.3 million ($2.6 million) from existing investors to start work on an orphan drug clinical trial. The Swiss biotech plans to raise more money through an IPO. Release
The European Medicines Agency granted orphan drug status to PsiOxus Therapeutics' ovarian cancer oncolytic vaccine, enadenotucirev. PsiOxus is currently evaluating the vaccine in a Phase I/II trial. Release
PharmaMar began preparing for a Phase III trial of its relapsed small-cell lung cancer drug. The Spanish drug developer decided to speed into Phase III after being impressed by an interim analysis of a Phase Ib trial of the drug. Release
ArGEN-X (EBR:ARGX) struck a deal with an unnamed U.S. biotech. The deal is an early example of how arGEN-X plans to use its antibody discovery platform to fuel collaborations. Release
Cellectis (EPA:ALCLS) followed up on last week's patent and IPO news by licensing CAR-T technology from The Ohio State University. Paris, France-based Cellectis will use the tech in a multiple myeloma program. Release
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