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(UPDATED: See below.)
Numerate, a San Bruno, Calif., “drug engineer,” said it has acquired all intellectual-property assets of Pharmix, a Brisbane, Calif., startup that designed drugs via computer. The company’s release is here.
As you’d expect, Pharmix appears to be defunct; its Web site now defaults to that of Numerate, although I haven’t been able to find anything that points to its cause of death. (Third-degree cash burn seems as good a guess as any.) For a look at what the company was about, check out this San Francisco Business Times story. Oddly enough, the co-founder of Pharmix, Guido Lanza, is now CEO of Numerate, so I suspect the story here may be a little more involved than it seemed at first.
Numerate now owns not only Pharmix’s drug-design technology, but also four therapeutic programs. In fact, Numerate’s lead drug candidates — several designed to reduce the risk of heart problems in diabetes patients, and others targeting HIV — all appear to have originated at Pharmix. Numerate was founded in March; the company didn’t disclose details of its transaction with Pharmix.
UPDATE: I just spoke to Numerate CEO Guido Lanza, who helpfully clarified a number of issues. Pharmix indeed “ran out of runway,” as Lanza puts it, and succumbed as its cash ran out. The company, founded in 2000, had focused on sophisticated computer modeling intended to produce “small molecule” drug candidates — that is, ones based on traditional chemistry, not bioengineering — from preset specifications. This sort of rational drug design has long been a goal of the pharmaceutical industry, which for just as long has failed to turn it into a reality.
Lanza says the company’s drug-engineering technology was “incredibly successful” at producing molecules that worked as intended in animal models. But while Pharmix had raised more than $13 million, it wasn’t enough to cover both the technology development and the costly process of producing actual drug candidates.
As the company wound down, Lanza and several other Pharmix officials decided to “keep going,” and convinced some of their existing angel investors to help fund Numerate, which hasn’t disclosed its financing so far. Acquiring the Pharmix drug-engineering system and its early-stage drug candidates now puts Numerate in a position to carry on Pharmix’s work, but with what the founders hope is a more sustainable business model.
Where Pharmix operated largely in stealth mode, Numerate intends to “let people know what we’re doing,” Lanza says. Yesterday, the company signed a partnership deal with Presidio Pharmaceuticals aimed at developing improved versions of drugs against hepatitis C. Such partnerships should not only bring in additional cash to offset Numerate’s burn rate, but — if all goes according to plan — will also give the company tangible news events with which to excite investor interest. Numerate is also pursuing its own internally developed drug candidates.
Numerate has already begun the process of raising a first round of funding, which it hopes to wrap up by midyear. Lanza declines to say how much money the startup hopes to raise, saying that the company is in early discussions with two classes of investors: Those who don’t want Numerate to give up exclusivity on its drug candidates, and others who want the company to minimize its burn rate via partnerships. “We’re trying to define our strategy within the next few months,” he says.