VentureBeat

Featured companies: 20/20 GeneSystems, Bellicum Pharmaceuticals, Cumbre Pharmaceuticals, Dara BioSciences, Enterprise Partners Venture Capital, Fermentas, International, Iasis Medical, New Leaf Venture Partners, Point Therapeutics, Power Medical Interventions, Rules-Based Medicine, Spinal Restoration, Still River Systems, Targanta Therapeutics

(UPDATED: See below.)

[NOTE: In the interests of getting items up as quickly as possible, I'm going to begin posting linked headlines, which I'll subsequently flesh out in many -- but not all -- cases. As the news gets heavier, the briefing is taking longer and longer to put together, to the point where I sometimes don't have much time to write about anything else. Feel free to let me know in comments how well this works for you.]

Spinal Restoration raises $16M for disc augmentation — Spinal Restoration, an Austin, Tex., developer of an implantable material designed to treat lower back pain, raised $16 million in a second funding round. Investors included Santé Health Ventures, MB Venture Partners, Austin Ventures and Path4 Ventures.

The startup is working on a filler biomaterial for ruptured spinal discs. This fibrin sealant, which is derived from human sources, is designed to be injected into ruptured discs in order to seal internal fissures and to prevent the leakage of the disc’s contents, potentially in a way that could encourage further healing. If it works, the process could potentially replace spinal fusion for patients whose injuries don’t respond to rest and physical therapy.

Antibiotic maker Targanta becomes latest disappointing biotech IPO — The Cambridge, Mass., developer of an in-licensed antibiotic for drug-resistant infections priced its IPO below its expected range, then saw its newly listed shared decline in early trading. Targanta priced as many as 5.8 million shares at $10 apiece, below its $12 to $14 range (see our coverage), raising the company a maximum of $57.5 million — down considerably from the $92.6 million it had hoped for.

Following the listing, Targanta’s shares dropped almost immediately, and by early afternoon were trading at $9.35, down 65 cents, or 6.5 percent.

I raised concerns about Targanta’s strategy here (capsule version: The company’s antibiotic Oritavancin faces a slew of competition and hasn’t even been tested in-house, as Targanta licensed it at a late stage from another company). Now it looks as though investors may have harbored similar reservations.

Power Medical sets IPO terms, aims to raise up to $62M for computer-assisted surgical instruments — Power Medical, a Langhorne, Pa., developer of computer-assisted surgical tools, said it would price up to 4.4 million shares at $12 to $14 apiece, which would allow it to raise as much as $61.6 million. Its SEC filing is here.

The company’s latest plans amount to a significantly smaller IPO than the $100 million offering it had initially contemplated. We last wrote about Power Medical’s IPO plans here.

Tularik spinoff Cumbre Pharma raises insider financing for anti-infective drugs — Dallas-based Cumbre Pharmaceuticals, a specialty pharma developing new anti-infective drugs, raised a new funding round from individual investors. Terms of the transaction weren’t disclosed.

Cumbre spun out of the former biotech Tularik (since acquired by Amgen) in 2001. It is focused on developing “hybrid” antibiotics formed by fusing together individual antibiotic compounds in hopes of producing more potent drugs that can take on microbes resistant to current antibiotics. Its lead compound, CBR-2092, has completed early-stage human trials, and is intended to attack drug-resistant staphylococcus infections.

Investors in the round included a number of prominent individuals in the life sciences. Among them were Tularik co-founder David Goeddel, Tularik and Cumbre co-founder Steven McKnight, Xenoport president William Rieflin, and former EDS president Morton Meyerson.

New Leaf Venture Partners raises $450M healthcare fund — New Leaf, a bicoastal VC firm with offices in New York and Menlo Park, Calif., raised $450 million for a new healthcare-technologies fund. The firm intends to target later-stage biotech and specialty pharma companies, early-stage medical-device developers, and new molecular diagnostics.

Bellicum Pharma draws in $3.8M for cancer vaccines — Bellicum Pharmaceuticals, a Houston biotech aiming to develop cancer vaccines, drew in $3.8 million in seed funding and a grant from the state of Texas. The company pulled in seed funding of $2.3 million from local angel investors; the $1.5 million grant was awarded by the state’s Emerging Technology Fund.

Bellicum is developing a therapeutic vaccine against prostate cancer that is designed to turn the body’s own immune-system defenses against tumors. (Dendreon, whose Provenge vaccine has been in the news over the past several months, is taking a similar approach.) The new wrinkle in Bellicum’s approach is that the company genetically modifies dendritic cells, which help direct immune responses against invaders in the body, so that they can be “activated” at a particular time and in a particular location in the body by applying a triggering chemical. There’s more here.

Other headlines of note:

• Dara BioSciences goes public with Point Therapeutics merger (release)
• Genetic Immunity raises $2M in bridge financing for HIV immunotherapy
• Rules-Based Medicine acquires EDI (release), wins $1.1M federal contract (release)
• 20/20 GeneSystems receives $2M NIST contract for tumor profiling (release)
• Summit Ventures invests in genomic-tools provider Fermentas (PDF release)
• Proton-therapy company Still River Systems raises $6.9M (PE Hub)
• Enterprise Partners suspends newest life-sciences fund (PE Hub)
• Iasis Medical raises $1.5M for undisclosed medical devices (PE Hub)

UPDATE: Expanded Targanta, Power Medical, Cumbre, New Leaf, and Bellicum items.
UPDATE REDUX: Corrected a typo in the Power Medical IPO data.

Featured companies: Ablynx, Cardiosolutions, Carigent Thereapeutics, Elusys, Genome Corp., GlobeImmune, Novazone, Targanta Therapeutics, Waterfront Media

UPDATED at 5:45am on 9/27/07

GlobeImmune raises $41M for immune-system therapies — GlobeImmune, a Louisville, Colo., biotech focused on new forms of immunotherapy to treat viral infections and cancer, raised $41.2 million in a third funding round. Investors included Wexford Capital, Celgene, the Mellon Family Investment Company, the Richard King Mellon Foundation, Eminent Venture Capital, Boston Life Science Venture, WRF Capital, HealthCare Ventures, Morgenthaler Ventures, Sequel Venture Partners, Lilly Ventures, Medica Venture Partners, Adams Street Partners, Biogen Idec, Pac-Link Bioventures, China Investment and Development, Yasuda Enterprise Development, Partners Healthcare, and GC&H Investments.

GlobeImmune’s experimental drugs are based on genetically engineered yeast cells, which have been altered to produce proteins that stimulate the immune system to attack diseased cells. The company’s lead product targets hepatitis C, and has completed early-stage human trials. Another drug is intended for use in pancreatic cancer.

Waterfront Media pulls in $25M for online health info — New York’s Waterfront Media, which bills itself as the largest privately held provider of online health information, raised $25 million in a fourth round of funding. Investors included Scale Venture Partners, Foundation Capital, Rho Ventures, Time Warner Ventures, BEV Capital, and Neocarta Ventures.

Waterfront said it will use the funds to expand its Everyday Health Network, a health-information portal, and to make acquisitions in the goal of becoming the “number one health destination” on the Web.

Novazone seeks $20M for food-safety tech — Novazone, a Livermore, Calif., developer of food-safety technology, is looking to raise $20 million in a third funding round, VentureWire reports (subscription required). Novazone is developing an ozone-based disinfectant for food and water purification. The company previously raised $7 million in 2006 from Chrysalix Energy, Foundation Capital and Grauer Capital.

Cardiosolutions raises $7M for heart device — Stoughton, Mass.-based Cardiosolutions, a medical-device maker focused on minimally invasive repairs to the heart’s mitral valve, raised $7 million in a first funding round. BioVentures Investors led the round.

The company’s device is intended to restore function to the valve that separates the two left chambers of the heart without open-heart surgery. Cardiosolutions was founded in 2006 by STD Med, a Stoughton-based medical-technology firm.

Elusys wins $12M contract for anthrax treatment — Pine Brook, N.J.-based Elusys, a biotech focused on antibody-based treatments for infectious disease, won a $12 million federal contract that will support development of its anthrax treatment Anthim. That treatment targets the so-called “protective antigen” component of anthrax, theoretically blocking the bacteria’s ability to produce fatal levels of toxin.

Ablynx wins €1.9M grant for miniature antibodies — Belgium’s Ablynx, a biotech working to devise new therapies using miniature antibody molecules, received a €1.9 million ($2.6 million) grant from the Institute for the Promotion of Innovation by Science and Technology in Flanders. The company said the funding would allow it to pursue new uses for its “nanobodies” and to expand its intellectual-property portfolio.

Genome Corp. raises $250K for new sequencing technology — Providence, R.I.-based Genome Corp. raised $250,000 in seed financing to extend development of a new high-speed DNA sequencing technology. The Slater Technology Fund provided the financing.

Nanotech-drug developer Carigent Therapeutics raises seed funding — Yale spinout Carigent Therapeutics, a New Haven, Conn., biotech working on a nanoparticle-based drug technology, raised an undisclosed amount of seed funding, VentureWire reports. Saint Simeon Marketing e Investimentos provided the funding in May.

The idea is that engineered nanoparticles can specifically target particular proteins, theoretically making them ideal “carriers” for other drug molecules that attack cancer, infectious pathogens or other other disease-related substances. The company has also secured $250,000 in grants from the National Cancer Institute and the National Science Foundation, and plans to target cancer with its first product, it told VentureWire.

Antibiotic maker Targanta sets IPO price range — Cambridge, Mass.-based antibiotic developer Targanta Therapeutics said it now hopes to raise up to $92.6 million in an IPO by selling shares at a price of $12 to $14 apiece. Targanta has previously expected to pull in $86.3 million; I wrote about some of the risks inherent in the company’s plans to win FDA approval for an in-licenced antibiotic called oritavancin that it hasn’t even tested itself here.

So far, Targanta seems to have managed to assure investors that it can overcome those challenges, which include some potentially strong competition from a variety of sources. Its offering will still serve as a good test of the strength of the biotech IPO market, which has been iffy for well over a year.

Targanta Therapeutics, a Cambridge, Mass. drug developer at work on a new generation of antibiotics, hopes to raise $86.3 million in an initial offering, according to an SEC filing. The company didn’t specify how many shares it plans to offer or what price it hopes they fetch.

Formerly known as PhageTech, Targanta moved its headquarters to Cambridge from Montreal last year. At about the same time, it brought on a new CEO, Mark Leuchtenberger, whose previous Boston-area company, Therion Biologics, cratered a year ago when its cancer vaccine for melanoma failed. Therion’s former CFO, George Eldridge, assumed the same job at Targanta in February.

The company’s lead drug candidate, oritavancin, is an intravenous antibiotic intended for treatment of drug-resistant bacterial infections. It has been tested against skin and “skin structure” infections as well as bacteremia, an infection of the blood, and is intended to supplant vancomycin, a generic antibiotic that is starting to lose potency against resistant bacterial strains.

Targanta’s S-1, however, makes for some interesting reading. Oritavancin was originally developed by Lilly, which subsequently licensed it to InterMune. Targanta acquired the rights to the drug in late 2005. Its two late-stage “phase III” tests in skin and skin-structure infections were conducted by Lilly and InterMune, despite which Targanta doesn’t envision filing for FDA approval until the beginning of next year.

Oritavancin also faces the prospect of serious competition from existing antibiotics, including vancomycin, Cubist Pharmaceuticals‘ Cubicin (daptomycin), and Pfizer’s Zyvox (linezolid). More potential rivals are on their way — the S-1 names Pfizer’s Zeven (dalbavancin), Theravance’s telavancin, Johnson & Johnson’s ceftobiprole and iclaprim from Arpida. Sounds like things could be pretty crowded by the time oritavancin makes it through the FDA.

This is all straight from the “Risk Factors” section of the S-1, where companies routinely exaggerate any conceivable risk to their future business, so you may want to take it with a grain of salt. The company’s venture backers — in February, it raised a $70 million third round — certainly appear to have done so. Still, it’s unusual to see a company file for an IPO in a soft market for biotech offerings with an in-licensed pipeline and so many real and potential competitors hanging around. We’ll see if investors are willing to overlook this stuff, although I suspect this offering might make them just a little nervous.