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TODAY’S HEADLINES:

• Amira Pharma strikes GSK partnership on lung, heart drugs worth up to $425M (release)
• Wolters Kluwer Health takes stake in Logical Images (release)
• Gentiva Health acquires Home Health Care Affiliates for $55M (release)
• Compuware buys Hilgraeve to upgrade healthcare IT (release)
• Touchstone Health appoints Michael Muchnicki CEO (release)
• Australia’s Xenome names Ian Nesbit as CEO (release)

Amira Pharma strikes GSK partnership on lung, heart drugs worth up to $425M – Amira Pharmaceuticals, a San Diego biotech focused on drugs for lung and heart problems, struck a partnership with GlaxoSmithKline potentially worth $425 million in upfront and milestone payments.

Amira is developing anti-inflammatory drugs based on its understanding of immune-system elements called eicosanoids. These fatty molecules are produced by white blood cells when foreign threats are perceived, triggering several different types of inflammation, which can damage healthy tissue when it’s prolonged by allergies or autoimmune disease.

Diseases such as asthma, chronic obstructive pulmonary disease, atherosclerosis, arthritis and psoriasis are often the result. Amira aims to defuse the underlying inflammation caused by eicosanoids by inhibiting “upstream” molecules that are necessary for their production.

The company’s two lead candidates have entered early stage, phase I human tests. One compound targets asthma; Amira hasn’t identified which diseases the second drug is being tested in.

Under the partnership, GSK will have rights to develop and commercialize all of Amira’s compounds in its current development program, which are technically known as FLAP inhibitors (FLAP standing for 5-lipoxygenase-activating protein). In return, Amira will receive an undisclosed upfront payment, milestones related to development and potential tiered royalty payments.

Wolters Kluwer Health takes stake in Logical Images – Logical Images, a Rochester, N.Y., developer of medical image-analysis tools, sold a minority equity stake to Wolters Kluwer Health, a healthcare-information company in Conshohocken, Pa. The companies didn’t announce terms of the deal.

Logical Images makes visual healthcare tools for physicians and patients. Its products include VisualDx, a diagnostic tool designed to help physicians identify some 900 visually identifiable diseases, and VisualDxHealth, which does roughly the same thing for interested consumers. The companies said they intend to integrate VisualDx with Wolters’ product Clin-eguide, a “decision support” tool for physicians.

TODAY’S HEADLINES:

• Taligen Therapeutics raises $65M for novel anti-inflammatory drugs (release)
• Dental-implant maker Biohorizons acquires Implant Logic (release)
• MAKO Surgical sets IPO terms, seeks $94M for knee implants and robots (Edgar)
• Canada’s Medical Ventures acquires two Israeli device startups (release)
• CRO Chiltern acquires Drug Development Solutions (release)

Taligen Therapeutics raises $65M for novel anti-inflammatory drugs –Aurora, Colo.-based Taligen Therapeutics, a biotech working on targeted anti-inflammatory drugs, raised $65 million in a second round of funding. The deal is one of the largest I can recall for an early stage company that’s not in the business of licensing in drugs from other companies for immediate clinical development.

Taligen’s focus is on the “complement system,” an arm of the innate immune system that reacts to threats by triggering a biochemical cascade that attracts immune cells and causes the release of inflammatory molecules such as cytokines. This sort of inflammation tends to rage out of control in autoimmune conditions such as rheumatoid arthritis or type 1 diabetes, eventually leading to serious tissue damage.

Existing targeted drugs for autoimmune disease typically take aim at only a few of the proteins involved in inflammation, leaving other “pathways” untouched. Taligen hopes to defuse the complement system at a more basic level, in particular by targeting “inhibiting factor B,” a protein that plays a key role in amplifying inflammatory response. As a result, the company hopes to merely tamp down activation of the complement system, not to block it altogether, which would likely leave individuals more vulnerable to infection.

Taligen’s drug candidates, which the company says will aim to treat both systemic and local inflammation, are still in preclinical development. That’s part of what makes the enormous size of the funding round such a surprise, since big bucks like these generally aren’t necessary until a biotech begins the expensive process of conducting human tests. In fact, though, the $65 million will be “tranched” and drawn down by the company only as necessary, so Taligen won’t have a huge pile of cash on its balance sheet until it’s ready to spend it.

Investors in the round included Alta Partners, Clarus Ventures, Sanderling Ventures, Tango and High Country Venture.

MAKO Surgical sets IPO terms, seeks $94M for knee implants and robots – MAKO Surgical, a Ft. Lauderdale, Fla., maker of knee implants and surgical robots, set its IPO terms and now hopes to raise as much as $93.8 million in its IPO. The company hopes to offer its shares at a price between $14 and $16 apiece.

MAKO markets a minimally invasive knee-repair system consisting of implants and a robotic-arm surgical devices. The aim is to minimize trauma to the knee in arthritic patients who might otherwise be candidates for full knee replacement. The MAKO system instead allows surgeons to “resurface” worn and damaged bones and then install small implants to restore their function. The company first received FDA approval for an early version of its system in 2005, and just this month was cleared to market its second major upgrade.

The company is still hemorrhaging cash — it reported a $15.9 million net loss on revenues of $355,382 in the first nine months of 2007. Most of its revenue to date has come from sales of implants and other disposable devices. MAKO says it has received some revenue from sales of the full robotic-surgery system, but that it can’t recognize it until it delivers version 2.0 of its system. The most recent release is version 1.2.

TODAY’S HEADLINES:

• Drug-screening tool maker IonGate Bio raises €4.6M (release)
• Protein-drug maker Molecular Partners gets $5M up front in Centocor deal (PDF release)
• ProtaGen takes in €1M for protein biochips (PDF release)
• China’s Sundia MediTech, a contract research organization raises second round (release)
• Vital-signs implant maker Transoma Medical sets IPO terms, aims for $78M (Edgar)
• UMD receives $1M grant for Baltimore biotech incubator (TechJournal South)

Drug-screening tool maker IonGate Bio raises €4.6M — IonGate Biosciences, a Frankfurt, Germany, developer of tools for drug screening, raised €4.6 million ($6.7 million) in a third funding round. Investors included Heidelberg Innovation and KfW (Kreditanstalt für Wiederaufbau).

IonGate, whose slogan appears to be “Measure More Membrane,” focuses on the study of proteins embedded in cell membranes, particularly “transport” proteins that move molecules of various sorts in and out of cells. The company’s tools allow drug companies to observe the activity of these proteins, apparently in order to determine whether particular drug candidates activate them in order to make their way into the cell interior.

The company plans to use the funding to expand its international operations, especially in the U.S. The company formed a U.S. subsidiary in December, and plans to build out distribution channels here in order to market its surface-protein analysis technology.

Protein-drug maker Molecular Partners gets $5M up front in Centocor deal — Zurich’s Molecular Partners, a biotech developing drugs based on a new class of binding proteins, struck a partnership with J&J’s Centocor unit (PDF link) that yielded the startup a $5 million upfront payment. The collaboration will focus on Molecular’s work with DARPins — the acronym stands for designed ankyrin repeat proteins, in case you were curious — that the company is currently developing as potential anti-inflammatory drugs.

Molecular will receive additional undisclosed cash for research and licensing fees, as well as royalty payments for any drugs that result from the collaboration. We covered their technology — which is interesting, but may also have serious drawbacks relative to monoclonal antibodies, which is Centocor’s specialty — in more detail here (fifth item).

ProtaGen takes in €1M for protein biochips — ProtaGen, a Dortmund, Germany, provider of protein-analysis tools, raised €1 million ($1.5 million — PDF link) in an interim financing. Investors included MIG, Co KG Beteiligungsfonds 3, S-Venture
Capital Dortmund and Kreditanstalt für Wiederaufbau (KfW).

The funding will allow the company to expand its development and sales of protein biochips, which enable relatively quick identification and analysis of proteins from biological samples. Such chips might one day be useful as diagnostic tools, although for now they are mostly used to find and “validate” proteins that might serve as “biomarkers” for the presence or progress of disease. ProtaGen is also working on its own diagnostics for Alzheimer’s disease and various inflammatory conditions.

China’s Sundia MediTech, a contract research organization raises second round — Sundia MediTech, a Shanghai contract-research startup founded by U.S. biopharmaceutical veterans, raised an undisclosed second funding round. Sundia didn’t disclose the identities of its investors beyond noting that first-round participant IDG Ventures was also involved in this funding.

Sundia’s press release makes for some amusing reading, and not just because it seems to have been written by someone with a relatively poor grasp of English. The statement is mostly devoted to extolling Sundia’s “excellent reputation” and “phenomenal growth,” not to mention the difficulty it has had beating investors off with a stick. For instance, there’s this:

One month later, Wuxi Pharmatech from the same city had a very successful IPO at New York Stock Exchange as the first Chinese CRO company to go public. Suddenly, CRO became a hot area for all investors to look for opportunities. ”Wuxi’s IPO definitely brought more investors to us”, the company’s CFO Dr. Beijia Yu recalled, ”We did have a difficult time to handle all requests from VCs, PEs and investment bankers for meetings to discuss investment possibility. The response to our fund raise from the investors was overwhelming.”

Maybe they deserve it — it’s difficult to say from here, and of course, it’s not as if U.S. startups don’t sometimes toot their own horn a bit loudly. Still, it’s an interesting example of the different cultural norms at play in a Chinese company.

Vital-signs implant maker Transoma Medical sets IPO terms, aims for $78M — Transoma Medical, a St. Paul, Minn., medical-device maker, set its IPO terms and now hopes to raise as much as $77.6 million. The company intends to price its shares between $14 and $16.

Transoma makes implantable devices that monitor patient vital signs. We previously covered them here.

TODAY’S HEADLINES:

• Gelesis draws in $16M for obesity treatments (release)
• Tempo Pharma raises $8B for nanoparticle drugs (release)
• Calistoga Pharma receives additional $5M for cancer and inflammation drugs (release)
• Montreux Equity Partners closes $250M life-sciences fund (release)
• MTS Health Partners names Andrew Weisenfeld, Mark Epstein managing directors (release)
• T2 Biosystems names John McDonough as CEO (release)

Gelesis draws in $16M for obesity treatments — Gelesis, a stealthy Boston company working on “novel” obesity treatments, raised $16 million in a first funding round. Investors included Orbimed Advisors and existing investors.

According to this Boston Globe story, Gelesis is developing a capsule containing an undefined “substance” that would expand in the stomach once swallowed, creating a temporary sense of fullness. The substance, whatever it is, would later pass out of the body.

Tempo Pharma raises $8B for nanoparticle drugs — Cambridge, Mass.-based Tempo Pharmaceuticals, a biotech developing “nanoparticle” formulations for new and existing drugs, raised $8 million in a second funding round. Investors included Polaris Venture Partners, Venrock, Lux Capital, Bessemer Venture Partners, Alexandria Real Estate Equities and William Rastetter, the former chairman of Biogen Idec.

The funding is Tempo’s second in just seven months; last May, it raised $12.1 million in a first round. (See our coverage here.) Tempo says the round reflects a “significantly increased valuation.”

Like other nanoparticle-drug companies, Tempo aims to improve the safety and efficacy of existing drugs — here by packaging them together in tiny capsules that release two drugs sequentially, presumably maximizing their effectiveness while minimizing side effects. Other nanoparticle-based companies we’ve covered recently include Carigent Therapeutics (here) and Bind Biosciences (here).

Calistoga Pharma receives additional $5M for cancer and inflammation drugs — Seattle’s Calistoga Pharmaceuticals, a biotech focused on new cancer and inflammation drugs, raised an additional $5.2 million in its first funding round. That brings the total round to $26.2 million.

Current investors provided the new funds. Previous investors in the round included Frazier Healthcare Ventures, Alta Partners, Three Arch Partners, Amgen Ventures and Eli Lilly, according to this Fierce Biotech story.

Calistoga, which was spun out of Icos after its acquisition by Lilly, is developing drugs against a class of biochemical-signaling molecules known as phosphoinositide-3 kinase. It currently has two drug candidates in preclinical studies.

Montreux Equity Partners closes $250M life-sciences fund — The Menlo Park, Calif.-based VC firm Montreux Equity Partners closed a $250 million life-sciences fund. The firm said the fund exceeded a $200 million target.

Montreux said the fund has already invested in several pharmaceutical and medical-device startups, including Glaukos, Avantis Medical, Tobira Therapeutics and Sequel Pharmaceuticals. We previously noted their fundraising efforts here.

(UPDATED: See below.)

Featured companies: Anaptys Biosciences, Arterial Remodeling Technologies, Cambria Biosciences, CaseNet, ChemoCentryx, Ensemble Discovery, MediQuest, Piedmont Pharmaceuticals, Raven Biotechnologies, Sensys Medical, Verus Pharmaceuticals, Xanodyne Pharmaceuticals

UPDATED: Expanded items on Anaptys, Arterial Remodeling, Raven Biotech, Sensys and MediQuest. Moved ChemoCentryx and Xanodyne to a separate item.

Antibody-drug maker Raven Biotech merges with VaxGen — Raven Biotechnologies, a South San Francisco biotech developing antibody drugs, is merging with the troubled, publicly held vaccine maker VaxGen. The confusingly worded release is here.

Although the deal isn’t technically a reverse merger, Raven is effectively taking over the shell that VaxGen has become. VaxGen, once best known for its pioneering, but ultimately failed, attempt to produce an AIDS vaccine, next set its hopes on producing anthrax vaccine for the U.S. government. But the company lost that contract in 2006. VaxGen had been delisted from the Nasdaq two years earlier. Since then, VaxGen has been looking to sell itself or to find some other combination with which it could make use of its cash ($56.5 million as of Sept. 30) and existing investment in biotech production facilities. [UPDATE: VaxGen's CFO wrote in to point out that the company also holds $20.7 million in "investment securities."]

Although Vaxgen will be the surviving company, Raven CEO George Schreiner will run the combined entity, most of whose business will consist of Raven’s antibody-drug development programs. The company’s lead candidate, RAV12, is currently in early-to-mid stage tests against a type of cander called adenocarcinoma. According to VentureWire, Raven has raised $115 million in venture funding.

All of which makes the deal’s valuation a bit puzzling. As of Sept. 30, VaxGen had 33.1 million shares outstanding, giving the company a market capitalization of $36.7 million at its closing price of $1.11 on the Pink Sheets. VaxGen will issue another 32 million shares and will end up with 51 percent of the combined company. Near as I can tell, that seems to value Raven at somewhere around $33 million, although I wouldn’t take that figure to the bank.

Before the deal can close, VaxGen needs to relist its stock on a national exchange. The two companies will undergo restructuring to save cash, and once combined will use Raven’s headquarters in South San Francisco.

Antibody-drug maker Anaptys raises $34M — Anaptys Biosciences, a San Diego biotech developing new antibody-based drugs, raised $33.9 million in a second funding round. Investors included Novo A/S, Frazier Healthcare Ventures, Alloy Ventures, Avalon Ventures, Numenor Ventures, WS Investment and Anaptys board member Nick Lydon.

Anaptys relies on a technique for producing large quantities of varied antibodies in order to find ones with the best “drug-like” properties. We’ve written about other companies working on similar “diversity generation” techniques, most recently AvidBiotics, which we described here.

Arterial Remodeling Tech gets €5.5M for absorbable stents — Paris-based Arterial Remodeling Technologies (no Web site), a device maker developing “bioresorbable” artery-opening stents, raised €5.5 million ($7.8 million). Investors included Matignon Technologies and SGAM Alternative Investments.

Stents are the meshlike tubes used to prop open blocked arteries following a heart attack. Existing stents can lead to side effects such as scarring and potentially dangerous blood clots, so companies such as ART are developing stents that slowly dissolve into harmless components such as carbon dioxide and water. Although ART doesn’t describe its technology in detail, see this 2004 press release about Guidant’s acquisition of a bioresorbable-stent startup and this article for a look at how these absorbable stents might work.

Glucose-meter maker Sensys Medical pulls in $3.8M — Chandler, Ariz.-based Sensys Medical, a device maker developing a non-invasive glucose meter for diabetics, raised $3.8 million of $4.5 million in bridge funding, VentureWire reports (subscription required). Investors included Adams Street Partners, Alliance Technology Ventures and Pappas Ventures.

MediQuest seeks $20M to $40M against Raynaud’s disease — Bothell, Wash.-based MediQuest, a biotech developing new treatments against Raynaud’s disease, aims to raise up to $40 million in a second funding round, VentureWire reports. The company recently reported positive late-stage data of its drug for Raynaud’s disease, a condition involving reduced blood flow to the extremities.

OTHER HEADLINES OF NOTE:

• Ensemble Discovery gathers $15M for DNA-based drugs (PE Hub)
• Piedmont Pharma draws $8.5M for parasitology drugs (release)
• CaseNet raises $7.5M for healthcare-management software (release)
• Cambria Biosciences pulls in $5M to fight neurodegenerative disease (release)
• Verus Pharma names Robert Keith as CEO (release)

Featured companies: AstraZeneca, Atlantis Components, Cara Therapeutics, CardioMems, Corium International, New Ortho Polymers, Osprey Pharmaceuticals, Othera Pharmaceuticals, StrataGent Life Sciences

Corium acquires Stratagent, raises $25.1M for “transdermal” drugs — Corium International, a Menlo Park, Calif., biotech focused on drugs that can be delivered through the skin, said it will acquire StrataGent Life Sciences of San Jose, Calif., for an undisclosed sum. At the same time, Corium raised $25.1 million in a third funding round, and said it has commitments for another $15.2 million within the next 24 months.

StrataGent, whose origins lie in work performed at Stanford, has focused on “needle-free” drug delivery using a microjet system in a microprocessor-controlled device resembling an electronic patch. (See our previous coverage here.) The company raised a $16 million round in May, although the company never received more than $6.7 million of that. Corium has a much broader focus that incorporates a variety of technologies for delivering drugs via the skin or mucosal surfaces such as the nasal passages or mouth.

Although ostensibly a straightforward merger, StrataGent CEO Robert Thomas will run the merged company, while Ron Eastman of Essex Woodlands Health Ventures — a previous StrataGent investor — will assume the job of chairman. StrataGent will relocate to Corium’s Menlo Park address. Investors in the latest round include Essex, Quantum Technology Partners, Aphelion Capital and an unnamed “strategic investor.”

CardioMems raises $23.3M for implantable heart sensors — Atlanta’s CardioMems, a medical-device company at work on a new generation of implantable heart sensors, raised $23.3 million in a still-open fifth funding round, VentureWire reports (subscription required). Investors in the round included “most” of the participants in the company’s previous round, a group that includes Arcapita Ventures, Easton Capital Partners, Boston Millennia Partners, Foundation Medical Partners, Medtronic Inc. and Johnson & Johnson Development Corp.

CardioMems is still looking for new investors. Its first product is a wireless sensor that can measure the pressure inside an aneurysm — a weakened section of an arterial wall that’s susceptible to rupture — during surgery intended to repair it.

Othera Pharma arranges $7M debt facility for an eye treatment — Exton, Pa.-based Othera Pharmaceuticals, a specialty pharmaceutical company at work on a new treatments for glaucoma and macular degeneration, arranged a $7 million debt facility with Oxford Financial, a subsidiary of Japan’s Sumitomo. The funding will help Othera advance its lead drug candidate in exsting mid-stage clinical trials.

Cara Thera receives $4M, moves to Connecticut from New York — Cara Therapeutics, a biotech formerly based in Tarrytown, N.Y., has received $4 million in facilities funding from Connecticut Innovations to help fund its move to Shelton, Conn. Cara, which is developing new pain and inflammation treatments, plans to use the money to build laboratory space in its new headquarters.

Connecticut Innovations is a quasi-public economic development agency. In a separate investment, the agency provided $250,000 in seed funding to New Ortho Polymers, a maker of orthodontic appliances.

EffRx raises convertible debt for osteoporosis — EffRx, a Tequesta, Fla., company that repackages old drugs in new formulations, raised an undisclosed some from a convertible debt offering, VentureWire reports. The funding will allow the company to push an “effervescent” version — think of Alka-Seltzer — of the osteoporosis drug Fosamax to the market. The investors weren’t disclosed.

Osprey Pharmaceuticals names new CEO — Osprey Pharmaceuticals, a Montreal biotech that’s consolidating its headquarters operations in San Francisco, named Jack Anthony as CEO. Anthony, currently an Osprey vice president, will remain in San Francisco. Osprey is developing new drugs for kidney disease.

AstraZeneca unit buys dental-implant maker for $71M — AstraZeneca’s medical-technology subsidiary, Astra Tech, agreed to acquire Cambridge, Mass.-based Atlantis Components for $71 million. Atlantis makes customized “abutments,” which are tiny components designed to stabilize dental implants. The company had previously raised about $26.3 million in four funding rounds, VentureWire reports.

(UPDATED at 12:30pm PT — see below.)

Featured companies: Capnia, AutekBio, Novacta Biosystems, XLHealth, Leprechaun, Agility Healthcare Solutions, AM Pharma, Milestone Pharmaceuticals, ChanTest

Capnia names former Alza head as CEO – The tiny Palo Alto, Calif., biotech Capnia hired Ernest Mario, a storied figure in the pharma/biotech world, as its CEO. Mario was most recently chairman — and previously CEO — of Reliant Pharmaceuticals, but he’s best known for running drug giant Glaxo (now GlaxoSmithKline) and, immediately thereafter, helming Alza for eight years until Johnson & Johnson acquired it for $10.5 billion in 2001.

Ever since his Alza experience, however, Mario has kind of been hopskotching his way across the industry. He headed Apothogen for four months until it was acquired by IntraBiotics (now Ardea Biosciences), then ran the combined company for a year before skipping to Reliant. Needless to say, the Alza lightning hasn’t yet struck twice.

Capnia’s interesting strategy is to develop drugs that can be delivered as a gas, presumably to be breathed in through the lungs. The company’s lead product, Capella, aims to treat migraines and nasal inflammation such as hay fever, and is currently in mid-stage testing.

Here’s the take on Capella from VentureWire (subscription required):

Capnia uses a gas dispenser to administer carbon dioxide into the nose. The company contends that this may be a safe and effective way to quickly relieve pain caused by migraine attacks and stuffy nose caused by allergies to pollen or environmental things like dust mites or pets. The company has conducted multiple Phase II studies in migraines and rhinitis and is planning additional Phase II trials, said Graham Crooke, managing partner of Asset Management Co.

Biologics manufacturer AutekBio raises $1.1M — AutekBio, a Silicon Valley-Chinese hybrid with its headquarters in Santa Clara, Calif., and operations in Beijing, raised $1.1 million in a first funding round, VentureWire reports. Acorn Campus Ventures and Desert Spring Life Sciences Capital led the round.

The company is a biological contract manufacturer that cultures genetically engineered cell lines for biotech and pharmaceutical concerns. AutekBio plans to raise a larger $10 million round in early 2008, according to VentureWire.

Novacta Bio raises $827K for new antibiotics — U.K.-based Novacta Biosystems, an antibiotic developer in Welwyn Garden City, England, raised $827,000 (€600,000). Investors in the round included Esperante, Westgate Hall, GEIF Ventures and Oxford Technology 4 VCT. Novacta is developing drugs to treat hospital-acquired infections, which are often resistant to standard antibiotics. Its lead candidate, for C. difficile infections, hasn’t yet been tested in humans.

Healthcare specialist XLHealth raises $290M, acquires Leprechaun — XLHealth, a private-equity backed healthcare-services company in Baltimore, raised $290 million in debt and equity and used part of the proceeds to acquire Leprechaun, a provider of healthcare-technology services based in Fort Worth, Texas. Funding was provided by MatlinPatterson Global Advisors, a private-equity firm. XLHealth says it is focused on improving the care of chronically ill seniors.

RFID patient-tracker Agility Healthcare raises $2M in debt — Agility Healthcare Solutions, a Richmond, Va., developer of patient-tracking systems utilizing RFID chips, closed a $2 million “credit facility” that supplements an earlier $6.25 million first funding round it raised in February. Square 1 Bank provided the loan.

Dutch biotech AM Pharma raises $3.4 million against infection and inflammation — AM Pharma, a biotech based in Bunnik, the Netherlands, raised $3.4 million (€2 million) in bridge financing. The company’s two main investors, Forbion Capital Partners and Inventages Venture Capital, provided the funding. AM Pharma is primed to begin raising a third round of funds; its lead drug candidates are respectively in mid- and early-stage human tests against kidney failure, ulcerative colitis and hospital-acquired infections.

Milestone Pharmaceuticals raises $2.6M against inflammation and heart disease — Montreal’s Milestone Pharmaceuticals, a biotech developing drugs against inflammation and heart disease, raised $2.6 million (C$2.75 million) toward its first funding round, VentureWire reports. Investors included MSBI Capital, Fonds Bio-Innovation and an undisclosed individual investor.

Cleveland’s ChanTest draws funds from Ampersand — ChanTest, a Cleveland, Ohio, developer of cell-based tests for drug safety, raised an undisclosed amount of funding from private-equity firm Ampersand Ventures. The company said the funding would support “strategic investments.”

From the company’s press release:

ChanTest’s primary focus is on a family of proteins known as ion channels. There are 400 genes encoding ion channels in the human genome, and countless more can be assembled from this gene collection. These ion channels may either represent targets for new drug development, or unintended targets that can result in unwanted side effects from new drugs. ChanTest pioneered the development of functional, cell-based ion channel testing as a means to predict cardiac side effects produced by non-cardiac drugs. Such testing is now a standard component of regulatory submissions prior to approval of drugs in humans.

UPDATE (11:05am PT): Added items on Novacta, XLHealth/Leprechaun and Agility Healthcare.

UPDATE, TAKE TWO (12:30pm PT): Added items on AM Pharma, Milestone Pharmaceuticals and ChanTest.

Read the rest of this entry »

Irving, Texas-based Reata Pharmaceuticals, a biotech working on new drugs to treat cancer and inflammation, raised $25 million in a fifth funding round. The round was led by existing investors, including CPMG and Novo A/S.

InCode BioPharmaceutics, a Lahaina, Hawaii, biotech targeting autoimmune and inflammatory disease, raised $2 million in a second funding round, VentureWire reports (subscription required). The funding was provided by Avalon Ventures.

InCode is developing what VentureWire vaguely describes as “therapeutic uses for certain amino-acid sequences in non-human proteins,” which sounds like they’ve bioharvested some peptides from other organisms that seem to have interesting properties. The company said the funding will carry its lead compound, which it calls rC3Decomplase, through preclinical lab and animal testing over the next 18 months.

Aquinox Pharmaceuticals, a Vancouver drug developer, raised $14.5 million in a first funding round. Ventures West Capital led the round, joined by Johnson & Johnson Development Corp., Baker Brothers Investments and BC Advantage Funds.

Aquinox is developing drugs that inhibit a newly discovered enzyme called SHIP (for more detail, see here) that appears to play an important role in blood cancers and inflammatory diseases. The company’s lead drug candidate, AQX-MN100, is still in animal testing.

Innovative Metabolics, a Boston developer of neuromodulation systems for “chronic disease,” raised $5.5 million in a first funding round, VentureWire reports (subscription required). The round was led by Morgenthaler Ventures, which was joined by Foundation Medical Partners.

Although the company apparently still wants to keep a low profile, it’s not too hard to make an educated guess at what it might be up to. In January, Innovative Metabolics paid $500,000 and an unspecified number of preferred shares to Critical Therapeutics to license technology for stimulating the vagus nerve.

From the Critical Therapeutics press release:

Innovative Metabolics is a privately held company founded by two of Critical Therapeutics’ co-founders, Kevin J. Tracey, M.D. and H. Shaw Warren, M.D. In 2002, Dr. Tracey and a team of researchers at The Feinstein Institute for Medical Research (formerly the North Shore-Long Island Jewish Research Institute) discovered a pathway for the anti-inflammatory signal between the brain and major organs such as the heart, stomach, liver and small intestine. As part of this discovery, the Feinstein Institute secured intellectual property directed to both therapeutic and device approaches of stimulating this anti-inflammatory pathway. The discovery of this pathway was published in the December 2002 issue of Nature. Critical Therapeutics licensed patent rights related to the modulation of this pathway by pharmacologic agents and vagal nerve stimulation from the Feinstein Institute in 2003.

In addition, there’s this recent abstract from a paper Kevin Tracey published earlier this year in the Journal of Clinical Investigation:

Cytokine production by the immune system contributes importantly to both health and disease. The nervous system, via an inflammatory reflex of the vagus nerve, can inhibit cytokine release and thereby prevent tissue injury and death. The efferent neural signaling pathway is termed the cholinergic antiinflammatory pathway. Cholinergic agonists inhibit cytokine synthesis and protect against cytokine-mediated diseases. Stimulation of the vagus nerve prevents the damaging effects of cytokine release in experimental sepsis, endotoxemia, ischemia/reperfusion injury, hemorrhagic shock, arthritis, and other inflammatory syndromes. Herein is a review of this physiological, functional anatomical mechanism for neurological regulation of cytokine-dependent disease that begins to define an immunological homunculus.

Translated, this excerpt suggests that Tracey — presumably, along with the company he co-founded — believes he’s discovered a way to tamp down inflammatory disease of the organs by stimulating the vagus nerve in a particular way. Of course, it’s not at all clear which conditions Innovative Metabolics is hoping to treat — if I had to guess at this point, I’d probably pick something that’s not even among the conditions listed in that abstract, such as inflammatory bowel disease.

In any case, all this is further proof that neuromodulation is a pretty hot area. For instance, I wrote about another company planning to use vagus-nerve interference to curb obesity here. Others are at work on related devices that could treat epilepsy, sleep apnea or hypertension.

Arete Therapeutics, a Hayward, Calif., developer of biotech cardiovascular treatments, raised a $35 million extension to its first round of funding. Founded in 2003, the company is working on “small molecule” drugs that target a metabolism-related chain of biochemical cellular signals that involves arachidonic acid. (If that isn’t enough to make your head hurt, the company has a detailed explanation here.) Drugs that interfere with that pathway could be useful in treating high blood pressure and inflammation; the company plans to move its first candidate into human testing later this year, according to VentureWire (subscription required).

Frazier Healthcare Investors and Alta Partners led the round, joined by Three Arch Partners, Burrill & Co. and Altitude Life Science Ventures. The company had previously raised $16 million in its first round in 2005, for a total so far of $51 million.

The company’s release is here (PDF).

Conatus Pharmaceuticals, a San Diego developer of drugs for inflammation and liver disease, closed a $22 million private placement that brings its first round of funding to $27.5 million. Investors included Aberdare Ventures, Advent Venture Partners, Bay City Capital, and Gilde Healthcare Partners.

Conatus was founded by former executives of Idun Pharmaceuticals in mid-2005 after Pfizer acquired their company. The funding will support mid-stage clinical trials of its lead compound, CTS-1027, for liver disease. The first trial, in hepatitis C patients, is expected to begin by the end of this year. Conatus licensed CTS-1027 from Roche last November.