VentureBeat

TODAY’S HEADLINES:

• Stent maker IDev Tech raises $25M (VentureWire)
• Xytis gets $15M for brain-injury drugs (VentureWire)
• Diagnostic maker Iris Biotech plans to go public, launch breast-cancer test (Edgar)
• RiverVest Venture Partners raises $75M life-science fund (release)
• Concentric Medical names Maria Sainz CEO (release)

[Note: I'm a little sad to announce that this will be my last life-science briefing at VentureBeat, although with luck, it won't be the end of my time here. Starting Monday, I'll be blogging regularly on the drug industry and healthcare over at BNET Industries, a new CNET venture, so drop by if you can. (Preparing for that move is the main reason non-briefing posts have been scarce recently.) I still hope to post here occasionally as well, since covering below-the-radar startups has been a blast, and I'm not ready to give it up quite yet.

It's been a great year -- my first VentureBeat post was on April 3, 2007 -- and I want to thank Matt for the opportunity to join you here, and all our regular readers and commenters for your time and your insights. As journalists, we're only as good as our sources and readers, and you guys have helped in countless ways to make me look much smarter than I really am. --D.P.H.]

Stent maker IDev Tech raises $25M – IDev Technologies, a Houston medical-device startup, raised $25 million in a third funding round, VentureWire reports. The company is developing a new type of stent for use in propping open the liver’s bile ducts .

The company’s existing investors, a group that includes Bay City Capital, Heron Capital, PTB Sciences and RiverVest Venture Partners, provided the funding. IDev had previously raised $24 million, according to VW.

Xytis gets $15M for brain-injury drugs – Irvine, Calif.-based Xytis, a biotech focused on disorders of the central nervous system, raised $15 million in an extension of its second funding round, VentureWire reports. Its backers included Atlas Venture, CDC Innovation, Sanderling Ventures and Ventech.

The company says it was founded in 2005 from the merger of Xytis Pharmaceuticals and Remergent. (Sounds more to me like Xytis swallowed Remergent, but they’re free to describe it however they’d like.) Its lead drug candidate, XY2405, blocks a cellular protein called the Bradykinin B2 receptor, a signaling molecule thought to promote inflammation.

Xytis is testing the drug as a potential treatment for traumatic brain injury; the molecule is currently in mid-stage, phase II trials. The company is also testing an antidepressant in early-stage trials.

Xytis raised half the money last August, then received the second $7.5 million in April, the company told VentureWire. It has previously raised $24.5 million in its current incarnation, and its “predecessor companies” pulled in $6.5 million.

Diagnostic maker Iris Biotech plans to go public, launch breast-cancer test – Santa Clara, Calif.-based Iris Biotechnologies, a developer of molecular diagnostic tests, is preparing to go public, VentureWire reports. The company plans a small offering on the OTC Bulletin Board — if I’m reading its latest SEC filing correctly, its existing shareholders will raise about $1.1 million, with no proceeds headed to the company  — and hopes to launch a breast-cancer test later this year.

Iris plans to use chips to measure gene activity in breast cancer, with the hope of predicting the odds that a surgically removed tumor will recur and, eventually, helping patients and doctors customize cancer treatment from an early stage. The company claims that it will be competitive with Genomic Health and Agendia, two companies with similar tests for predicting breast-cancer recurrence.

There’s something a little odd about Iris’ disclosures in the SEC forms, though. Iris doesn’t describe its technology, the genes it will test or how it settled on them in any detail, and spends almost as much time talking about its database of patient information and related computer technology as it does about its tests. While it may consider some or all of that information a trade secret — and disclosure requirements may well be looser for such a small offering — it’s still kind of unusual for a startup to ask outside investors to put up their money essentially on faith.

TODAY’S HEADLINES:

• Boston Scientific spinout TriVascular2 takes in $65M (release)
• Inhaled-drug startup Transave raises $35M (release)
• Triage Wireless gets $20M for vital-signs monitors (release)
• Tryton Medical receives $14M for “bifurcation” stents (release)
  
• Synthetic bio startup Codon Devices adds $11M (release)
• Tracon Pharma takes in $4.5M against cancer and eye disease (VentureWire)
• Antibody maker f-star swaps in equity stake by TVM (PDF release)
• Drug packager MonoSol Rx withdraws IPO (IPOhome)
• GE Healthcare acquires portable-ventilator maker VersaMed (release)

Boston Scientific spinout TriVascular2 takes in $65M – In 2005, Boston Scientific acquired a Santa Rosa, Calif., medical-device startup called TriVascular. Today, it spun it out once again.

The newly private startup raised $65 million in a “first” funding round from the likes of MPM Capital, New Enterprise Associates, Delphi Ventures and Kearny Venture Partners. Thirty million dollars of that sum went straight to Boston Scientific, which also retains the right to take a minority stake in the company.

TriVascular’s original CEO, Michael Chobotov, will resume that position at the new company, joined by two other TriVascular founders. It’s not, however, entirely clear what TriVascular will be doing. The company was originally focused on repair of abdominal aortic aneurysms, which are unusual swellings of blood vessels that can rupture unexpectedly, often fatally. Boston Scientific, however, shut down its aneurysm-repair business in 2006, so it’s not immediately obvious that the reborn TriVascular will jump right back in.

Inhaled-drug startup Transave raises $35M – Transave, a Monmouth, N.J., biotech working on inhaled drugs for lung disease, raised $35 million in a fourth funding round. Investors included Quaker BioVentures, Bessemer Venture Partners, TVM Capital, Prospect Venture Partners, Fidelity Biosciences, Forbion Capital Partners and Easton Capital.

The startup is working on inhalable drugs for cystic fibrosis — in particular, a long-lasting form of the antibiotic amikacin, which is currently in mid-stage, phase II human testing. Transave had previously raised $58 million in venture capital, including a “recently completed” $40 million round.

Triage Wireless gets $20M for vital-signs monitors – Triage Wireless, a San Diego medical-device maker, raised $20.3 million in a second funding round. Investors included Qualcomm Ventures, Sanderling Ventures, 3i Group and Intel Capital.

Triage is developing wireless vital-signs monitors for long-term or continuous use. Its first product is a blood-pressure sensor that doesn’t require the old familiar inflated cuff.

TODAY’S HEADLINES:

• InfraReDx takes $17M for arterial-plaque detection (VentureWire)
• Cancer-drug developer Serenex sells out to Pfizer for undisclosed sum (release)
• Life-sciences fund Longitude Capital raises $95M (VentureWire)
• Hospital consultant Intercede Health names Gray Miller as CEO (release)

InfraReDx takes $17M for arterial-plaque detection – InfraReDx, a Burlington, Mass., developer of diagnostic systems that detect arterial plaque, raised $17 million in a third funding round, VentureWire reports. Sanderling Ventures led the round, joined by new and previous individual investors.

InfraReDx previously planned to raise up to $40 million in order to support expected commercialization of its near-infrared device, which can identify buildups of arterial plaque that can rupture and lead to heart attacks (see our coverage). The test, however, requires a minimally invasive procedure in which the device is threaded into a patient’s circulatory system, making the InfraReDx device primarily useful for preventing second heart attacks in patients who are being treated for their first.

The company submitted its device for FDA approval in October, and is planning on a limited rollout if the device is cleared this quarter, as InfraReDx expects.

Cancer-drug developer Serenex sells out to Pfizer for undisclosed sum – Durham, N.C.-based Serenex, a biotech working on drugs that could be useful in cancer and other conditions, agreed to be acquired by Pfizer. The release is here. The companies didn’t disclose terms of the deal.

Serenex claimed to have a technology for developing drugs against a wide variety of cellular proteins, but in practice Pfizer appears to have been most interested in drugs that inhibit heat-shock protein 90, or Hsp90, a molecule that regulates other proteins crucial to cellular growth and survival. The startup’s lead compound, SNX-5422, is in early-stage, phase I testing against a variety of tumors.

Pfizer, of course, will also walk away with Serenex’s drug-discovery technology and a library of other drug candidates. Notably, however, Pfizer did not buy the startup’s leading experimental drug, SNX-1012, which is being tested against oral mucositis, a common side effect of chemotherapy. That, of course, leaves open the possibility that Serenex management — or someone else — will try to form a new company around that drug. This sort of strategy is increasingly popular; for my take on it, see here.

Life-sciences fund Longitude Capital raises $95M – Menlo Park, Calif.-based Longitude Partners, a spinout of Pequot Ventures, raised $95 million of an anticipated $325 million first fund, VentureWire reports. The fund will invest in biotech, medical-device and drug-development startups.

TODAY’S HEADLINES:

• Metabolic-disease biotech NGM Biopharma raises $25M (peHUB)
• Heart, HIV drug maker Numerate acquires assets of Pharmix (release)
• Next-gen sequencer VisiGen promises $1,000 genome by late 2009 (Genome Technology)
• CalciMedica raises $5.5M for autoimmune drugs (VentureWire)
• Cancer-drug e-marketplace OneOncology raises funds (release)
• U.K. biotech Hunter-Fleming acquired by Newron for €8M (release)
• Intertek acquires Ireland’s Bioclin Labs, a contract research organization (release)

Metabolic-disease biotech NGM Biopharma raises $25M – South San Francisco-based NGM Biopharmaceuticals (Web site under construction), a biotech developing new drugs for heart and metabolic conditions, raised $25 million in a first funding round, peHUB reports. Investors included Column Group, Prospect Venture Partners and Rho Ventures.

NGM, currently helmed by Tularik founder David Goeddel on an acting basis, isn’t divulging much about its plans. According to VentureWire, the company is developing new treatments based on “post-genomic bioinformatics” (a virtually content-free buzzphrase if I’ve ever heard one) and “new approaches to human biology” (which isn’t much better). NGM plans to devote the funding to R&D spending over the next three years.

The company’s ties to the former Tularik — which was acquired by Amgen in 2004 — are worth noting. In addition to Goeddel, the company’s chief scientific officer, Jin-Long Chen, was formerly a VP of biology at Tularik, and then headed Amgen’s metabolic-disorders unit.

Heart, HIV drug maker Numerate acquires assets of Pharmix – I’ve updated this item and moved it into a standalone post here.

Next-gen sequencer VisiGen promises $1,000 genome by late 2009 – Does anyone else hear a bandwagon banging through town? Just three days after secretive Pacific Biosciences took the wraps off its high-speed sequencing effort, Houston-based VisiGen Biotechnologies laid down a new marker and said it plans to offer $1,000 sequencing of human genomes by the end of 2009 at the rate of roughly one genome a week.

The news, which comes courtesy of GenomeWeb, further turns up the pressure in the bragging-rights race to achieve the artificial “$1,000 genome” benchmark. More than a half-dozen companies have thrown their hats into the ring either explicitly or implicitly, each with its own complex approach to reading every one of the six billion DNA letters, or bases, in a human’s 23 pairs of chromosomes.

VisiGen was founded in 2000, and has received funding from Applied Biosystems and Houston’s SeqWright, as well as grants from the National Institutes of Health.

CalciMedica raises $5.5M for autoimmune drugs – San Diego’s CalciMedica, a biotech developing drugs for immune-related conditions, raised $5.5 million in a second funding round, VentureWire reports. Investors included Sanderling Ventures and SR One. We previously noted the startup’s first funding round here.

The company plans to attack autoimmune diseases such as rheumatoid arthritis and psoriasis by targeting a “calcium channel” — that is, a cellular mechanism that moves calcium in and out of cells — in immune-system components that govern the body’s adaptive immunity. That arm of the immune system sometimes goes haywire, producing autoimmune disease in which the body’s defenses attack normal tissue. CalciMedica acquired technology and drug candidates for targeting that calcium channel from TorreyPines Therapeutics in May.

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.

(UPDATED: Expanded items on LineaGen, BG Medicine. Pelikan Tech is described in a standalone item here.)

TODAY’S HEADLINES:

• Pelikan Tech raises $69M for diabetes glucose tests (release)
• Utah’s LineaGen draws $6M for genetic diagnostics (VentureWire, sub req’d)
• Beijing’s IKang Healthcare gets $25M for medical-service centers (VW)
• BG Medicine drops IPO price range, seeks up to $52M (Edgar)
• Sepragen completes acquisition of Cyto Biologic Tech (release)

Utah’s LineaGen draws $6M for genetic diagnostics — LineaGen (no Web site), a Salt Lake City biotech focused on genetic diagnostics, raised $6 million in a first round of funding, VentureWire reports. Investors included
Sanderling Ventures, vSpring Capital and Mesa Verde Partners.

The company aims to identify genomic markers — presumably the single-letter DNA variations known as single-nucleotide polymorphisms — for a variety of diseases, including autism, multiple sclerosis, cancer and lung disease. LineaGen is using detailed databases on Utah’s predominately Mormon population, which keeps careful genealogical records, to identify markers that it can then turn into diagnostic tests for those conditions.

A variety of other companies have been embarked on similar projects, most notably DeCode Genetics, which has been conducting genetic analyses on the Icelandic population for years. VentureWire notes that Genzion Biosciences has been doing the same for French Canadians.

BG Medicine drops IPO price range, seeks up to $52M — Waltham, Mass.-based BG Medicine, a developer of molecular diagnostics, dropped its IPO price range and now plans to raise no more than $52 million. The company, which had previously sought to offer up to 5.2 million shares at a price between $14 and $16, now aims for a price between $8 and $10. Its latest SEC filing is here.

The company’s setback is but the latest in its unusual IPO history. It first reported plans to go public on Amsterdam’s EuroNext exchange, then apparently scrapped that idea and filed to list on the Nasdaq Stock Exchange. At its previously price range, BG Medicine stood to raise as much as $83 million, so its latest decision represents a fairly significant haircut to its earlier hopes.

Novocell, a San Diego embryonic stem-cell company, raised $25 million in a third round of funding. That’s presumably a bit of a letdown for the company, which had previously hoped to pull in as much as $35 million in the round. I wrote earlier about Novocell’s fundraising here.

The round was led by Johnson & Johnson Development, the venture arm of J&J itself, joined by Sanderling Ventures, Asset Management Company and Pacific Horizon Ventures.

In my earlier piece, I explored whether J&J’s involvement marked the first time that Big Pharma had directly funded an embryonic stem-cell company. It turns out that’s probably true, although J&J’s investment in Novocell dates back to at least 2005, a fact I didn’t learn until a few days after I wrote that post. (I had updated the previous item with that acknowledgement, but the update somehow got lost in WordPress, so I’ll just make the point again here.)

I’ve also heard from some sources that J&J’s interest isn’t so much in stem cells as in a separate Novocell technology for “encapsulating” cells to protect them from immune-system rejection after a transplant. Although that sort of technology might be useful for protecting stem-cell transplants, it’s also got potential utility outside the stem-cell field. For instance, if transplants of insulin-producing pancreatic islet cells ever became feasible as a diabetes treatment, encapsulation might be one way to ensure that the cell transplants “take” without forcing patients onto immunosuppressive drugs for the rest of their lives. (Exactly how to procure a reliable supply of islet cells is a separate problem, since donors and cadavers tend to be in short supply — and that’s where stem cells are likely to enter the picture.)

Novocell, in fact, is currently performing early-stage trials of exactly that sort of therapy, using islet cells procured from cadavers. The encapsulated cells are injected into “tissue pockets” just under the skin of the thighs or the lower abdomen. Last year, the company presented preliminary data from the study in which the cells transplanted into the first two treated diabetics appeared to show early signs of functioning without triggering an immune-rejection response.

Since the study was supposed to include 12 patients who would be monitored for 12 months, new data from that study might not be too far off, which probably helps explain J&J’s interest in leading this new round.

NeoMend, an Irvine, Calif., biomaterials company focused on wound care, raised $6 million in a third funding round, VentureWire reports (subscription required). Investors included Prospect Venture Partners, Sanderling Ventures and other unidentified venture capitalists. Four million dollars in bridge loans from Prospect and Sanderling also converted into equity.

NeoMend is developing an adhesive gel it calls Pro/PEG that can be sprayed or injected into surgical or other wounds to close them up. The company said the funding proceeds would cover the launch of its first product, which is aimed at sealing up arterial injuries.

TheraVida, a new biotech based in San Mateo, Calif., has raised seed funding from Sanderling Ventures, VentureWire reports (subscription required). The company, which doesn’t seem to have a Web site (a possible stub site is here), is researching possible drugs for urological problems.

According to VentureWire, the seed funding was less than $1 million, although the company may seek a larger first funding round by the end of the year. TheraVida has one employee, a former researcher at TheraVance.

Naviscan PET Systems, a San Diego maker of high-resolution positron-emission tomography (PET) scanners, raised $15 million in a third round of funding led by QuestMark Partners.

Returning investors included Sanderling Ventures, Mayo Medical Ventures and Walker Ventures. The company plans to use the new funding to continue clinical validation and commercialization of its PEM Flex Solo II PET scanner, which it claims can image tumors less than two millimeters in diameter.

Naviscan, previously based in Rockville, Md., last raised $6.5 million in Nov. 2005. See the company’s release on its latest funding here.