VentureBeat

Oraya, a secretive Menlo Park, Calif., medical-device startup, has struck again. The company raised $18 million in what is presumably a second funding round, VentureWire reports (subscription required). Investors included Synergy Life Science Partners (see yesterday’s coverage of this newish VC firm here) and Essex Woodlands Health Ventures. We covered Oraya’s first round of funding last June.

VentureWire says the company is working on some sort of unspecified ophthalmology device, which is certainly more than we knew last year. Oraya’s founder and CEO is Michael Gertner, a surgeon and serial medical-device entrepreneur who is also a consultant to the Biodesign Program and Department of Surgery at Stanford. (He’s also an adjunct partner at Essex Woodlands, which has a somewhat more detailed — and possibly out-of-date — bio for him here.)

Eye disease would be something of a departure for Gertner, who has previously founded five other device startups, all of which still appear to be keeping themselves largely under wraps (for instance, any Web sites tend to be uninformative stubs):

• Medlogics Device Corporation — Develops non-polymer drug-coated stents for treating arterial blockages. Founded in 2003.
• Allux Medical — Develops electro-optical devices for allergic rhinitis (hay fever). Founded in 2004.
• Minimus Surgical Systems — Develops unspecified electromedical equipment, although these patent applications suggest the company is working on implantable, remote-controlled balloon devices that reduce stomach volume for the treatment of obesity.
• Hydrocardia — Apparently named after an obscure medical term for excess fluid in the pericardial sac that surrounds the heart. No Web site.
• Gem Biosystems — No further information beyond the fact that it raised $1 million from Essex Woodland in 2006

A quick look through Gertner’s patent applications and issued patents doesn’t turn up too many additional clues as to what Oraya might be doing. He does have one issued patent and at least two applications dealing with what appears to be a valved “fistula,” a blood-vessel graft used to ease the trauma of routine needle insertions in kidney dialysis — but of course that has nothing to do with ophthalmology. (In fact, this technology could easily be related to Gem’s business.)

In any event, it’s intriguing to note that even the oldest of Gertner’s companies appears to have no marketed products and continues to fly mostly under the radar. Which suggests to me either that Gertner or his investors simply have a real passion for secrecy — which is entirely understandable — or that perhaps things haven’t gone quite as well as planned. In any event, Gertner looks like someone worth keeping an eye on. (Hat tip to Mark Wendman, who first pointed out Gertner’s work to me.)

According to VentureWire, the new funding will carry Oraya into clinical trials. Gertner told the newswire only that the company expects to begin human tests of its devices “shortly,” so who knows what that means.

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.

Read the rest of this entry »

Palo Alto, Calif.-based Horizon Therapeutics, a biotech that aims to combine existing generic drugs to fight pain, raised $30 million in a third funding round. The company’s lead drug candidate, known only as HZT-501, is a “proprietary” combination of the generic drugs ibuprofen and famotidine, the latter of which is better known by its brand name Pepcid. It’s aimed at providing pain relief without gastrointestinal discomfort or injury, which is the same claim made by Cox-2 inhibitors such as Merck’s withdrawn pain drug Vioxx.

Horizon’s basic idea, which is both interesting and risky, is that packaging together existing drugs like these into a single pill may ameliorate side effects. Famotidine, for instance, suppresses the production of stomach acid, so by combining it with ibuprofen, Horizon hopes to reduce the likelihood of ibuprofen-related ulcers.

That’s the interesting part. The risky part is that patients and their doctors can usually just take the existing generic drugs together for the the same effect. Horizon hopes that its combination pill will prove more convenient for patients than the separate drugs. Would-be competitors to HZT-501, for instance, have different dosing schedules — two to three times a day for ibuprofen, but only once or twice a day for famotidine. (Hat tip to Lou Bock, a VC at Scale Venture Partners, who described Horizon’s strategy in the course of a longer conversation nearly two weeks ago.)

Will that be enough for Horizon to fend off generic competition? It’s hard to say, but Horizon’s backers clearly want to believe it will be. The latest round was led by Essex Woodlands Health Ventures, who was joined by existing investors Scale Venture Partners, Sutter Hill Ventures and Pequot Ventures.

Horizon has previously raised $21 million in equity funding. The company said the latest round will allow it to push HZT-501 through its current late-stage trials and potentially into an approval filing with the FDA, while also advancing a second drug candidate, HZT-602, into late-stage trials. HZT-602 combines another painkiller, naproxen, with famotidine. Naproxen is better known by its over-the-counter name Aleve.

(UPDATED: See below.)

Oraya Therapeutics, a stealthy medical-device developer in Menlo Park, Calif., raised $4 million in a first funding round, VentureWire reports (subscription required). Essex Woodlands Health Ventures provided the funds.

From the VentureWire story:

Based in Menlo Park, Calif., Oraya is a stealth-mode medical device company founded in June 2006. According to the filing, the company’s board includes Essex Woodlands Partner Guido J. Neels and Adjunct Partner Michael E. Gertner.

Peter Cohn, a partner at the Menlo Park office of law firm Orrick Herrington & Sutcliffe LLP, was listed as secretary of Oraya.

UPDATE: This item still seems to draw a steady stream of traffic, so I thought I’d also direct readers to a later, more detailed item on Oraya’s second-round funding and the entrepreneurial background of founder Michael Gertner that we published in January.

StrataGent Life Sciences, a San Jose developer of needle-free “microjet” injection systems, said it closed a $16 million second round of financing. The company has so far received $6.65 million of that round; the remainder should become available next year if and when StrataGent meets certain milestones.

The round was led by Essex Woodlands Health Ventures. Other investors include Quantum Technology Partners and Aphelion Capital.

StrataGent’s own description of what it’s up to in its funding release is somewhat cryptic. It touts the company’s microjet injection system, which sounds like something out of Star Trek, but figuring out exactly what it is takes some surfing around. According to this UC Santa Barbara press release, this PRish Web page from Stanford’s technology-licensing office, and this funding application posted at NIST’s Advanced Technology Program, the StrataGent technology looks to be a microprocessor-controlled “patch” device that can deliver a large-molecule protein drug directly to the bloodstream. (Protein drugs have to be injected, since the digestive system would break them down too quickly if they’re delivered as pills.)

From the Stanford page:

Based on pulsed liquid microjet technology invented at Stanford, the device creates small, high-speed jets of liquid that penetrate the outer layer of the skin and precisely deposit drugs into the epidermis (the top layer of skin), enabling rapid absorption by the body, while avoiding the pain receptors that lie below in the dermis. This means that the device delivers drugs as effectively as an injection, but without needles.

It sounds pretty cool, although it’s worth remembering that people have been trying, and failing, to do something like this for some time. I’m particularly curious what wearing one of these patches does to your skin over time; StrataGent apparently believes it’s overcome the problem of pain and bruising caused by repeated microjet injections, but it will probably take clinical trials to know if that’s true.

StrataGent’s release also quotes Ron Eastman of Essex boasting about the company’s “pipeline of commercially attractive molecules,” so the company is also apparently reformulating various protein drugs for use with their microjet system. According to the Stanford page, StrataGent is partnered with an unidentified Japanese pharmaceutical company. As for which drugs they’re working with and where they stand in the process — well, the release is silent. Neither is StrataGent’s Web site much help — it’s “under construction.” (Hat tip: VentureWire.)