VentureBeat

Point Biomedical, a San Carlos, Calif., developer of new biomedical-imaging products, raised $25 million in a recapitalization, peHub reports. Such recapitalizations often amount to a kind of “reset button” for existing investors and lenders, and usually suggest that a startup has run into some kind of significant — but not insurmountable — obstacle.

Investors in the recap round include new investor Vedanta Opportunities Fund and existing investors William Blair Capital Partners, De Novo Ventures, Institutional Venture Partners, Saints Capital, Sprout Group and CHL Medical Partners. The recapitalization includes an additional $32.3 million that will become available to Point Bio once it attains an unspecified milestone, which it expects to occur in April.

There’s presumably a release about this, but Point Bio’s Web site has been down all morning, so for now I’m relying on peHub and VentureWire reports. I’ll update if the release turns up. According to VentureWire, Point Bio had previously raised over $110 million from a variety of venture-capital and private-equity firms.

Point Bio is developing a medical imaging and drug-delivery technology based on tiny, nested spheres it calls the BiSphere. This technology is currently in late-stage trials as an “imaging agent” that should make it possible to observe the flow of blood through the heart using ultrasound instead of more invasive methods. We previously covered the company when it raised money last July and described its technology in more detail there.

(UPDATED: See below.)

A common dilemma in biotech acquisitions is how to keep a startup’s entrepreneurial management happy and productive when they’ve just been assimilated by the Borg. The answer, often enough, is not to bother, and to let them spin out a new company with scientific “leftovers” that weren’t the point of the acquisition in the first place.

That’s more or less what Amgen has just done in launching Relypsa, a new Santa Clara, Calif., biotech just spun out of the big biotech’s Ilypsa unit. Relypsa is basically a full restart of Ilypsa — thus the name, I suppose — which Amgen acquired earlier this year for roughly $420 million (see our coverage here).

Of course, the new startup now lacks the kidney-disease drug (specifically, a treatment for hyperphosphatemia) that Amgen had shown particular interest in. But Relypsa is free to rev up its existing drug-discovery platform — one focused on making drugs out of long-lasting polymers that grab and eliminate excess molecules such as potassium or sodium — and also managed to keep a pipeline of promising candidates that might one day be useful in treating kidney and heart disease.

Such restarts of acquired biotechs aren’t unknown in the industry, although they’ve been growing in popularity. For instance, the former management of Eyetech Pharmaceuticals recently banded together to form Ophthotech with technology left over from Eyetech after it was swallowed by OSI Pharmaceuticals (our coverage here). This sort of strategy is likely to hold increasing relevance for Big Pharma as its companies fire up their biotech-acquisition machines.

The Relypsa deal, however, may set records for speed and continuity. The former CEO of Ilypsa, Jay Shepard, reprises that role at Relypsa; Ilypsa co-founder Garrett Klaerner returns as COO; and Ilypsa’s former chief medical officer Detlef Albrecht now resumes that position at Relypsa. (Honestly, props to whoever came up with the name “Relypsa,” because it’s really apropos here.) And so on down the line.

Relypsa raised $33 million in a first spinout round, with investors that included 5AM Ventures, New Leaf Venture Partners, the Sprout Group, Delphi Ventures, CMEA Ventures and Mediphase Venture Partners. Amgen, of course, retains a minority stake in Relypsa, and probably insisted on some form of right-of-first-refusal should Relypsa get interested in striking a partnership with — or selling itself to — another company. (I’ve asked Relypsa’s representatives about that, and will report back if I learn more.)

UPDATE: Relypsa’s external PR person got back to me on the right-of-first-refusal question, but kudos to you if you can make any sense of it. Here’s the response in its entirety: “Amgen retained certain rights related to transferred programs customary for spin outs at this stage. Relypsa will initiate partnering campaigns for certain indications and territories as appropriate.” Well, that was helpful. Sometimes I wonder why I bother asking.

UPDATE REDUX: In a later interview, Relypsa COO Gerrit Klaerner told me that “of course” Relypsa has an “entanglement” with Amgen, although he wouldn’t go much further than the official statement in describing Amgen’s particular rights. “There is enough skin in the game for Amgen to keep an interest in Relypsa,” he said. “If you see us doing a partnership, you will get an answer to your question.”

Klaerner added that the idea of recreating Ilypsa came up shortly after the acquisition. “We wanted to save a bunch of jobs and create a new home for the technology,” said Klaerner, who worked as an advisor to 5AM for the deal. “We had 38 people who, after the success of Ilypsa, had multiple job offers and asked them to stick with us, even though the company wasn’t really created.” What’s more, he said, Amgen’s backing of the deal didn’t waver despite the company’s recent woes (see, for instance, here). “Given what they were going through, to give this level of high-level support was really, really remarkable,” Klaerner said.

Oh, and the name Relypsa was apparently an internal placeholder that turned into the real thing when no one could think of anything better, Klaerner said.

FINAL UPDATE: I started thinking about other recent deals that resemble Ilypsa-Relypsa after an email correspondent planted the bug in my ear. The one that comes most immediately to mind would be the launch of Sequel Pharmaceuticals — another clever name — out of NovaCardia’s acquisition by Merck (our coverage here). Another example would be Cerexa Pharmaceuticals, which spun out of Peninsula Pharmaceuticals in 2005 after Peninsula was purchased by J&J. Cerexa was acquired by Forest Labs this past January, and doesn’t appear to have launched another spinout.

Have any other good examples? Sound off in comments.

Featured companies: Bioptigen, Echo Therapeutics, Forest Laboratories, Intrinsic Therapeutics, Microbia, Phreesia, Sontra Medical, TransMedics, Xanthus Pharmaceuticals

[NOTE: This is a catchup briefing, posted on 9/28/07. I've adjusted the item's timestamp to keep the briefings in chronological order. --D.P.H.]

Patient-info digitizer Phreesia takes in $10.3M — Phreesia, a New York company that claims to offer a “100% free” — but ad-sponsored — digital patient check-in application to doctors, raised $10.3 million in a second funding round. Investors included Polaris Ventures Partners, HLM Venture Partners, Long River Ventures and Village Ventures.

Phreesia offers doctors wireless touch-screen pads and related software designed to replace the traditional check-in clipboard in doctors’ offices. Among other claimed benefits, the technology is designed to provide legible patient information and to conduct patient interviews — along the lines of those endless rows of checkboxes that ask you to recall your own medical history and sometimes that of your immediate family as well. The catch is that the devices will then beam sponsored “educational” content at patients, although Phreesia claims doctors can first review it and that patients can skip it if they want. (Any guesses on how easy people will find to do that?)

I hope to return to Phreesia before much longer — among other things, they plan to present at Demo this year. (UPDATE: They’ve done so, and apparently were named one of the best presentations at the conference.) And there are certainly plenty of cool things about this idea, not least the fact that returning patients can merely confirm their information instead of filling it all out again. Still, the service raises lots of questions, not least among them the consequences of letting “sponsors” — read: “drug companies” — have direct access to patients in waiting rooms. Anyway, this looks interesting enough that I’ll definitely take a closer look.

Xanthus aims for $30M to support leukemia treatment — Cambridge, Mass.-based Xanthus Pharmaceuticals, a biotech with a small-molecule drug against acute myeloid leukemia, intends to raise $30 million in a third funding round, VentureWire reports (subscription required). The company would aim to complete the funding by late this year or early next.

The leukemia drug, which the company calls Xanafide, has completed mid-stage human tests (PDF) that Xanthus claimed “associated” the drug with complete remissions. The trial wasn’t blinded or randomized, which in short means it’s almost impossible to draw such sweeping conclusions from it. Xanafide isn’t a particularly exotic drug, either; as a topoisomerase II inhibitor, it shares the same basic mechanism of action as many traditional chemotherapy drugs. Still, this is why companies carry out blinded, randomized late-stage trials, which Xanthus says it intends to begin with Xanafide before long.

Spinal-device maker Intrinsic raises $21M — Intrinsic Therapeutics, a Woburn, Mass., device maker focused on minimally invasive spinal-disc repair, raised $21 million in a fourth funding round, VentureWire reports. Investors included New Enterprise Associates, Spray Venture Partners, Sprout Group and an unidentified institution.

The company’s been close-mouthed about its progress, although VentureWire reports that it recently began selling its disc devices in Europe. The financing is intended to fund future clinical trials and the costs of applying for FDA approval.

Live liver transplanter TransMedics files for $86.3M IPO — In case you’re not a Monty Python, that headline is a joke — although not by much. TransMedics, an Andover, Mass., medical-device company, aims to develop a box that can keep living, transplanted organs alive. They’ve filed to raise $86.3 million in an IPO. This is another fascinating-sounding company I’ll have to come back to once I’ve caught up on these briefings, but in the meantime feel free to check out their S-1 and their Web site. Also, I should note that TransMedics is actually focused on heart transplants, not liver.

Eye imager Bioptigen gets $500K infusion — Durham, N.C.-based Bioptigen received a $500,000 convertible financing as it prepares for a second funding round. Investors included the Piedmont Angel Network Two and other existing investors. Bioptigen is developing a real-time imaging system for ophthalmic indications.

Microbia strikes deal worth up to $330M for GI disorders — Microbia, a Cambridge, Mass., biotech with a focus on gastrointestinal and heart disease, struck a partnership with New York’s Forest Laboratories worth up to $330 million to develop its first GI drug. Microbia gets a $70 million upfront payment and milestone and licensing payments worth much more if the development is successful. Microbia has already raised $231 million in venture equity. See the company’s release here (PDF).

Featured companies: Bravo Health, InfraReDx, MedAssets, Prestwick Pharmaceuticals

Prestwick Pharma raises $20M for neuro drugs — Specialty pharma Prestwick Pharmaceuticals, a Washington, D.C., firm that acquires cast-off drug candidates to treat neurological conditions, raised $20 million from existing investors, VentureWire reports (subscription required). Among those participating in the funding were Atlas Venture, Sofinnova Ventures, Vivo Ventures, Scale Venture Partners, Warburg Pincus and Pequot Ventures.

Prestwick said it raised the funds to acquire additional drug candidates. The company filed to go public in 2005, but pulled its filing in December of that year.

InfraReDx aims for $40M to detect artery plaque — Burlington, Mass.-based InfraReDx aims to raise $40 million in a “mezzanine” financing to launch its artery-plaque diagnostic system, VentureWire reports. The company is talking to existing and potential new investors, including VC firms and hedge funds.

InfraReDx is developing a near-infrared spectroscopy system for the detection of arterial plaque, which can rupture and create blood clots that could lead to a heart attack. The company expects to complete a clinical trial in October that could lead to approval of the device.

Bravo Health raises undisclosed sum for acquisition — Bravo Health, a venture-backed provider in the Medicare prescription-drug coverage plan formerly known as Elder Health, raised an undisclosed sum in an eighth funding round, VentureWire reports. The funding covers the company’s recent acquisition of a Philadelphia Medicare provider called Senior Health.

Investors included all backers from the company’s previous funding round, a group that includes New Enterprise Associates, Frazier Healthcare Ventures, CCP Equity Partners, Salix Ventures, Alpha Partners, Coleman Swenson Hoffman Booth, Franklin Venture Capital, Frontenac Co., GE Capital, Norwest Venture Partners, Riggs Capital Partners, Sprout Group, Wasatch Venture Fund and Woodbrook.

MedAssets, healthcare IT provider, aims for $230M IPO — MedAssets, an Alpharetta, Ga., provider of healthcare IT and consulting services, filed to raise up to $230 million in an initial offering. The company aims to help community hospitals increase “revenue capture” and “cash collections” and to manage “non-labor expense categories.”

Oddly, MedAsset doesn’t appear to have yet maximized its own revenue capture, as it posted a net loss of $23.8 million last year on revenues of $177.9 million.

(CORRECTED: See below.)

Seattle-based NeuroVista, a developer of devices for the treatment of epilepsy, raised $33.8 million in a second-round funding and left behind its former name, BioNeuronics.

The company, founded in 2002 by whiz kid Daniel DiLorenzo, has been quiet about its technology and commercial direction. In April, however, DiLorenzo received a patent for a “neurological control system” using “closed-loop intracranial stimulation” for the “optimal control of neurological disease.” In other words, given NeuroVista’s public interest in epilepsy, it sounds very much like it’s working on implantable neuromodulation devices that could monitor and perhaps counteract the early signs of an oncoming seizure. (Hat tips: VentureWire and Neurotech Business Report).

VentureWire also reports that one other venture-backed company, NeuroPace, and two established device makers, Medtronic and Houston-based Cyberonics, may also be researching epilepsy devices.

Here’s NeuroVista’s vaguely worded announcement. The round was led by Advanced Technology Partners and Delphi Ventures, who were joined by Three Arch Partners, Sprout Group and Foundation Medical Partners.

CORRECTION: An earlier version of this item stated that Dan DiLorenzo “co-founded” NeuroVista. He’s informed us that he was the sole founder, and I’ve corrected the item to reflect that.