VentureBeat

TODAY’S HEADLINES:

• VaxGen, Raven Bio terminate merger agreement (release)
• Aerovance gets $20M in venture debt for respiratory disease (release)
• EKOS raises $5M for ultrasound catheters (peHUB)
• Intelligent Bio-Systems draws $353K for high-speed genome sequencing (peHUB)
• Quintessence Bio takes in $5M for cancer-directed proteins (VentureWire)
• 7 Health Ventures adds three members to investment team (release)
• Contract manufacturer Cytovance names Darren Head CEO (release)

VaxGen, Raven Bio terminate merger agreement – A weirdly structured, always hard-to-understand merger between the failed vaccine biotech VaxGen and startup Raven Biotechnologies has collapsed. The two companies called off the combination after it became clear that a majority of VaxGen shareholders would reject it.

The deal aimed to create a new company out of VaxGen’s cash holdings and biomanufacturing facilities and Raven’s antibody-drug program, which remains at an early stage of development. The merger would also have given Raven a quick route to public listing of its stock. Both companies are located in South San Francisco, Calif.

But many VaxGen shareholders — in particular, the investment firm MedCap Management & Research, which waged a sharp effort to derail the deal — believed the deal undervalued VaxGen, which they figured would yield a better return to investors through liquidation. VaxGen, a once pioneering maker of experimental vaccines against HIV and anthrax that is now little more than an empty shell, said it would immediately assess its strategic alternatives, including possible liquidation.

Aerovance gets $20M in venture debt for respiratory disease – Aerovance, a Berkeley, Calif., developer of asthma and eczema drugs, took on $20 million of venture debt. The startup drew down $10 million of that sum at closing; the rest will become available once it achieves unspecified milestones.

A syndicate of lenders provided the funding, including Oxford Finance Corporation, Silicon Valley Bank and Comerica Bank. Aerovance, which spun out of Bayer Pharmaceuticals in 2004, said the funding would enable it to continue looking for a drug-company partner for its asthma drug and to pursue other “strategic goals.”

EKOS raises $5M for ultrasound catheters – EKOS, a Bothell, Wash., maker of ultrasound-enhanced drug-delivery systems, raised $5 million in new equity funding, peHUB reports, citing a regulatory filing. No investors were disclosed. As we wrote last June when the company raised $10 million in venture debt, EKOS makes catheters that use both drugs and ultrasound to break up blood clots.

Intelligent Bio-Systems draws $353K for high-speed genome sequencing – Waltham, Mass.-based Intelligent Bio-Systems raised $353,000 in a first funding round, peHUB reports, citing a regulatory filing. The company is developing next-generation DNA analysis systems and promises to deliver technology that can sequence a full human genome for just $5,000 in about 24 hours, as we described earlier.

Latest Silicon Valley round-up:

IPO window opening? — Lots of companies filing to go public lately. In just the past couple of days, there’s WiMax company Clearwire (see our story), game company Glu Mobile (see story), WiFi company Aruba (see story) and now rumors of software company Netsuite preparing one.

Redback Networks comes long way — This San Jose company went big, and then bankrupt in 2003. Now we learn the company, which manages 50 million broadband connections, has been bought by telecommunications equipment maker, Ericsson for $2.1 billion.

Google offers multiple destinations – You’ve probably noticed that Google has improved its directions service on Google Maps. It started storing previous addresses you’ve looked, and now has offered a way to look up multiple destinations in one go. You just hit the “add destination” button (see image below)

U.S. dumps VaxGen — In an unusual dose of tough medicine, the U.S. government canceled its $877.5 million contract with Brisbane’s VaxGen for an improved anthrax vaccine because the company didn’t meet its deadlines. Good overview of the debacle here in the Merc.

Zoho continues its barrage of software offerings, offers Wiki product — We’ve written about this scrappy, low-cost, but impressive software provider before. It has one of the widest arrange of online software products out there, many of them free. It told VentureBeat yesterday that Zoho Wiki is now available. You can create it for public use, or private use among a group. Zoho’s previous weakness was that many of its products weren’t integrated within the same platform, but it has moved to change that lately. The Wiki, for example uses Zoho Writer as the editor, and appears to have most of the other features you’d want (spell check, integration with spreadsheets, immediate syncing when those spreadsheets are changed, YouTube video embedding, RSS for pages). More details here.

Podaddies, yet another advertising start-up — Gigaom reviews San Francisco start-up, Podaddies, which wants to place advertising in user-generated video. We don’t see much new here. It does want to customize the service to each site it serves, but there are others that do that too. It is a self-admitted “tortoise” among many hares.

Milpitas is wired with WiFi — Earthlink announced that its service in Silicon Valley city of Milpitas is now ready for use. However, it is not free. After 30 days free testing, a user must pay $21.95 a month. Occasional users can pay rates ranging from $3.95 for a one-hour pass to $15.95 for a three-day pass.

The latest roundup of the action happening in Silicon Valley:

First evidence of YouTube wealth — What do you do with your money, when you get it? One way is to spend $20 million to buy Andre Agassi’s Tiburon estate. That’s what Stuart Peterson, of Artis Capital Management, an investor in YouTube, did, as PE Week’s Alex Haislip reports. Or you can invest it into night clubs, as some Web entrepreneurs have done.

Google Answers shuts down, while Yahoo Answers booms — This is one more confirmation that Google does best with automation. It started its answering service before Yahoo did, yet was blown away by Yahoo. Google is not adept at the messy business of getting humans involved. Yahoo claims 60 million unique users of Yahoo Answers. It just signed a deal with Answers.com, too. This is a rare victory for Yahoo, and should encourage it to stay focused on its relative advantage at implementing “community”-oriented projects.

Allow comments anywhere on your site — There are some places on blogs or web sites where comments aren’t enabled by the site’s software. So Lev Walkin, a Cisco Security Engineer out of Santa Clara, has come up with a way to let you place them pretty much anywhere, called JS-Kit (via Techcrunch).

Will U.S. Supreme Court brake global warming action? — The future of many clean-tech start-ups here in Silicon Valley depends in part on Washington. The U.S. Supreme Court is deciding whether California can move ahead with strict pollution controls. In European, meanwhile, the opposite is happening. Brussels is forcing stricter controls on member states, rather than braking.

Danger raises $10.3 million from Sharp –This deal makes sense, because Sharp is building a Danger “hiptop” device, similar to the one distributed by T-Mobile, to run Danger’s software. Also, in case you missed it, see the update on our recent snarky post about Danger and its IPO. Hank Nothhaft took exception, and we clarified some facts. He says the company’s valuation has increased, which is a good sign.

Fuddy U.S. companies on London’s AIM — Now the Brits are suddenly asking why the U.S. companies going public on the London alternative stock market AIM are doing so poorly. Two thirds of them are losing money for investors. Could the reason be that the only reason U.S. companies listing on AIM is because 1) they couldn’t do it in the U.S., or 2) they couldn’t raise money from private equity investors (or venture capitalists) at a time when it is very easy to raise money?

Presto launches the photo service for elderly or tech-phobic — We wrote about Silicon Valley company Presto’s product a while back. Presto has $10M from venture firm Kleiner Perkins and others.