Radius Health maps out its next two years
About eight months ago, Radius Health CEO C. Richard Lyttle, PhD, took a hard look at the company's budget as well as the increasingly shaky state of affairs in the world of finance. And he concluded that the company needed an extra cushion of cash.
We needed enough money "to give us a runway where we could make decisions based on good knowledge," says CEO C. Richard Lyttle. "We didn't want to get to the position where we were getting low on cash. The idea was to get Phase II data for hot flashes, and then we could look at partnering or M&A possibilities."
Last week, Cambridge, MA-based Radius announced that it had accomplished what the developer had set out to do, raising $15 million in a second close of a Series C that has now brought in a total of $82.5 million.
"This gives us enough cash to accomplish our work for the next two years and still have cash in the bank," says Lyttle, whose company is focused on developing new therapies for osteoporosis and women's health. "Given the financial situation in the U.S., our decision was to get some money to have enough cash, continue studies and not have to worry about doing something we don't want to do."
MPM Bio IV NVS Strategic Fund led the round and MPM Capital, The Wellcome Trust, HealthCare Ventures, Oxford Bioscience Partners, BB Biotech Ventures, and Scottish Widows Investment Partnership joined in.
"It was a tough environment, as you could expect," says Lyttle. "We're happy to say we were successful."
Back in April Radius qualified for $28.3 million in a second tranche of venture cash after completing enrollment in a Phase II dose-finding study of BA058, a treatment intended to build bones in women suffering from osteoporosis. The experimental drug is an analog of the parathyroid hormone-related protein.
Radius in-licensed its first two programs from Ipsen--which provided BA058--and Eisai, which licensed out non-Japanese rights to a new class of selective estrogen receptor modulators.
Radius' third molecule is "home grown," says Lyttle. RAD1901--a novel SERM (selective estrogen receptor modulator)--is being studied in a Phase I trial as a treatment for hot flashes and a Phase IIa is scheduled for early 2009. Radius has also selected a preclinical candidate from its SARM (selective androgen receptor modulator) discovery program for muscle loss. An IND is expected in the second quarter of next year.
That's all familiar territory for Lyttle, who was vice president of discovery for women's health and bone as well as head of the women's health research institute at Wyeth. At Wyeth, he directed drug discovery in women's health for several areas including menopause, contraception, reproductive disorders, osteoarthritis, osteoporosis, and urinary incontinence.
Novartis has taken an option on the developer's lead program.
"We are now finishing the Phase II element of this, a six-month study," says Lyttle. "With that data they would take a look at it and decide if they want to take an option."
And if Novartis does pick up the option on the program, the pharma giant would be responsible for conducting a Phase III trial. Radius would be in a position to gain up to $500 million in milestone payments, part of which would go to Ipsen.
Currently Radius has a staff that's equivalent to 28 full timers. And that number won't grow quickly.
"Our initial goal was never to expand and increase the head count," says Lyttle. "We do it very cautiously. Our goal is not to expand rapidly at all."
Adds Lyttle: "We try and run a very efficiently."