VentureBeat

Featured companies: Imalux, Sagent Pharmaceuticals, Sequel Pharmaceuticals, Sinexus, TranS1, U.S. Spinal Technologies

Sagent Pharmaceuticals draws in $53M for injectable generics — Sagent Pharmaceuticals, proving that there’s still life in the apparently lucrative but boring specialty-pharmaceuticals business, raised $53 million in a first funding round. Vivo Ventures led the round for the Schaumburg, Ill., company.

Like other specialty pharmas, Sagent essentially picks up abandoned or cast-off drugs from other companies and tries to make them work in new ways. The company plans to take its first product to market in the fourth quarter, VentureWire reports (subscription required).

From VentureWire:

Schaumburg, Ill.-based Sagent focuses on the development of injectable treatments. The company’s core strength is generic pharmaceuticals, Yu said, and it has a broad-based focus on injectable treatments for a variety of indications. Sagent currently has more than 200 products in development, and plans to launch its first injectable treatment, which has already been approved by the Food and Drug Administration, in the fourth quarter. For the commercialization, Sagent plans to draw on the 20 business partnerships the company has worked to establish, Pauli said.

NovaCardia spinoff Sequel Pharma draws on $20M for heart drug — Fresh from the sale of NovaCardia to Merck (see our coverage here), officials of that heart-drug company founded a second startup, San Diego’s aptly named Sequel Pharmaceuticals, and raised $20 million in a first funding round. Investors included Domain Associates, Forward Ventures, InterWest Partners, Montreux Equity Partners, and Skyline Ventures.

Sequel owns the rights to one of NovaCardia’s former drugs, which it intends to develop as a treatment for atrial fibrillation, a problem characterized by uncoordinated pumping and electrical activity in the heart’s upper chambers that can put people at risk of blood clots and strokes. The company also plans to develop novel drugs for its pipeline.

U.S. Spinal Tech to seek $20 million — Boca Raton, Fla.-based U.S. Spinal Technologies said it plans to solicit $20 million in third-round funding, VentureWire reports. The company has begun speaking to investors but hasn’t yet received any money.

So far, the company has raised $9 million, 40 percent of that from angels and the remainder from other individuals. U.S. Spine makes several spinal implants that are already on the market, but a flagship device designed to replace the “pedicle screws” that serve as anchor points for rods in spinal fusion is stilll under development.

Sinexus raises $3.5M for sinusitis devices — Palo Alto, Calif.-based Sinexus raised $3.5 million in a first funding round, PE Hub reports, citing a regulatory filing. Investors included Kleiner Perkins Caufield & Buyers and U.S. Venture Partners. The medical-device company is focused on treating chronic inflammation of the nasal passages.

As it turns out, Sinexus also received seed funding in 2003 from Durect, a company that makes drug-delivery technologies. According to this 10-K filed with the SEC, Durect and an unnamed venture-capital firm each loaned Sinexus $150,000; Durect repurchased the obligation from Sinexus in February 2006.

Medical imager Imalux pulls in $5.1M — Cleveland’s Imalux, a developer of optical-tomography imaging systems, raised $5.1 million in a third funding round. The proceeds include the conversion of $2.5 million in bridge financing. Early Stage Partners, ElectroSonics Medical, Reservoir Venture Partners, Symark, and more than twenty other prior and new investors participated in the round.

Spinal-device maker TranS1 sets IPO range, aims to raise up to $88.6M — Wilmington, N.C.-based TranS1, a developer of minimally invasive spinal-fusion devices, said it plans to price its IPO shares between $12 and $14 apiece, yielding a maximum possible take of $88.6 million. See our earlier coverage of TranS1’s IPO here.

Featured companies: Cyntellect, Lectus Therapeutics, NeoMatrix, Nexstim, Pearl Therapeutics, Proteon Therapeutics, SupplyScape

(UPDATED at 10am PT: See below.)

Airway-disease specialist Pearl Therapeutics raises $15.5M — Redwood City, Calif.-based Pearl Therapeutics, a drug-formulation company focused on respiratory disease, raised $15.5 million in a first funding round. Investors included New Leaf Ventures, Clarus Ventures and 5AM Ventures.

Pearl doesn’t appear to have a working Web site yet, but according to its release, the company aims to treat unspecified airway diseases using “particle technologies” it has licensed from Nektar Therapeutics. Nektar, of course, is the company that spent years co-developing the inhalable insulin Exubera with Pfizer, only to see it flop in the marketplace — not least because the bulky inhaler resembled nothing so much as a bong.

In fact, Pearl’s ties to Nektar run deep. In addition to licensing its basic technology from Nektar, the company was founded in 2006 by two former Nektar executives, Adrian Smith and Sarvajna Dwivedi. Pearl most likely also aims to reformulate existing drugs into a better inhalable form — and presumably hopes for better luck in doing so.

Proteon Therapeutics sucks in $12M for vascular drug — Proteon, a Waltham, Mass., biotech, raised $12 million in a follow-on to its first funding round. Investors included TVM Capital, Skyline Ventures, Prism VentureWorks and Intersouth Partners.

Proteon’s main drug candidate, PRT-201, aims to do something new by permanently enlarging blood vessels at the site of administration. The technology is based on elastases, a type of protein-cutting enzyme, which supposedly modify the “extracellular matrix” of blood vessels in order to enlarge them. The company expects the drug might be useful for kidney-dialysis patients, who now often have to undergo surgery to create blood vessels large enough for a connection to the blood-filtration devices, and in peripheral arterial disease.

Brain scanner Nexstim beams in €8M — Nexstim , a Helsinki, Finland-based developer of brain-imaging techniques, raised €8 million ($10.9 million) in a private placement. Investors included HealthCap, LSP (Life Sciences Partners), Finnish Industry Investment and Sitra.

Nexstim is working on a new brain-imaging technique it calls “navigated brain stimulation.” The details are pretty hairy — check out the company’s release if you’d like to know more — but it essentially combines several different electromagnetic-imaging techniques with a movable coil that can be guided wherever the operator would like. The system isn’t approved for clinical use, although Nexstim said the funding would allow it to obtain the necessary regulatory approval.

Health software company SupplyScape raises $10M, names new CEO — SupplyScape, a Woburn, Mass., developer of supply-chain software for life-sciences companies, raised $10 million in a third funding round. Investors in the latest round included IDG Ventures Boston, North Bridge Venture Partners, Pilot House Ventures, Bethesda Partners, and Pfizer Strategic Investments Group.

The company also named Mark O’Connell, former CEO of MatrixOne, as its chief executive.

The average person, however, could be forgiven for having no clue what SupplyScape actually does. According to the company’s press releases, it makes software to “maximize product integrity and create business value for pharmaceutical, biotech, medical device companies.” Its Web site promises “collaborative pharmaceutical value chains” that improve “security and profitability.” As it turns out, the company’s software helps track and trace drugs from their point of manufacture through various distribution channels in order to guard against counterfeits, at least so far as I can tell from its Web site.

Cancer screener NeoMatrix raises $9.6M — San Diego’s NeoMatrix, a company focused on early detection of breast cancer, raised $9.6 million in a third funding round. Private investors provided the funding, the company told me. (Its release doesn’t include these details.) Out of sheer coincidence, two southern California businessmen — Anthony Ciabattoni and Richard Franco Sr. — also just joined the company’s board (see the release for details).

Founded in 2000, NeoMatrix sells a screening test that detects pre-malignant or malignant cells in “nipple aspirate fluid,” which is extracted from the breast using a “gentle” suction device. The company said the new funds will allow it to hire its first sales reps, expand its marketing efforts and to convert or retire remaining debt the company used to finance development of its test.

Lectus draws in £3M for MS drugs — Cambridge, England-based Lectus Therapeutics, a biotech focused on a class of drugs known as ion-channel modulators, raised £3 million ($6.1 million) in funding from the Wellcome Trust. The investment is intended specifically to fund development of drugs for multiple sclerosis. Lectus had previously identified its primary disease interests as urinary bladder disorders, pain and angina.

Cell imager Cyntellect adds $3M in funding — Cytellect, a San Diego developer of cell imaging and manipulation systems, raised an additional $3 million in a fourth funding round, bringing the total for the round to $18.1 million. Bru II Venture Capital Fund, based in Reykjavik, Iceland, provided the additional funding.

Cyntellect’s laser-based equipment makes it possible to fluorescently image cells, isolate and destroy unwanted cells in a sample, and to “optoinject” various molecules directly into cells. See our previous coverage here.

UPDATE (10am PT): Added items on Cyntellect, Lectus Therapeutics, NeoMatrix, Nexstim, Pearl Therapeutics, and Proteon Therapeutics.

Read the rest of this entry »

Satiety, a Palo Alto, Calif., device maker focused on obesity, raised $30 million in a fourth round of funding. Skyline Ventures led the round, joined by HLM Venture Partners, Pinnacle Ventures, Venrock, Three Arch Partners, Morgenthaler Ventures and Thomas Fogarty.

Satiety is developing a minimally invasive device for stomach-reduction surgery consisting of a stapling tool that can be passed down the throat into the stomach. The company was founded in 2001.

Arca Discovery, a Denver developer of a next-generation beta blocker for heart failure, raised $18 million in a second funding round. (The release is out, but not yet available on the Web.) The round was led by Skyline Ventures and joined by Interwest Partners, Atlas Ventures, Boulder Ventures and the Peierls Foundation.

Later this year, Arca plans to file for FDA approval of bucindolol, a failed beta-blocker designed to lower heart rate and blood pressure in patients with congestive heart failure. In 1999, bucindolol — then under development by Incara Pharmaceuticals — failed a major clinical trial conducted by the VA and the NIH.

Arca, which acquired the drug in 2003 from a joint venture of Incara and Indevus Pharmaceuticals, has worked to salvage the drug by identifying two genetic variants that appear to identify people most likely to respond to it. It has partnered with LabCorp to develop a genetic-diagnostic test that will identify patients with those genetic variants.

Few drugs are currently marketed with such tests, although experts predict that such “personalized medicine” will be much more common in the future. One of the major exceptions at the moment is Genentech’s breast-cancer drug Herceptin, which was approved a decade ago with a test that can identify the 25 percent to 30 percent of women whose tumors are most likely to respond to the drug.