VentureBeat

TODAY’S HEADLINES:

• Adnavance pulls in C$3.7M for molecular diagnostics, names new CEO (release)
• “Personalized medicine” co. Proprius sells to Cypress Bio for up to $75M (release)
• Vaccinex raises $25M in wake of GSK deal for antibody drugs (VentureWire)
• Cianna Medical receives $9M for breast-cancer radiation treatment (release)
• Electron-microscope image provider NanoImaging takes in $1.5M (release)
• CrystalGenomics, ProQuest Investments create JV co. Palkion (release)
• Portico Systems, software maker for insurance plans, raises $7.7M (release)
• Stealthy biotech Affomic takes in $7M (peHUB)

Adnavance pulls in C$3.7M for molecular diagnostics, names new CEO – This item is now a standalone post here.

“Personalized medicine” co. Proprius sells to Cypress Bio for up to $75M – Proprius Pharmaceuticals, a San Diego diagnostics maker, sold itself to publicly traded Cypress Bioscience for up to $75 million in cash. The company’s release is here.

Cypress will pay $37.5 million up front, and another $37.5 million to Proprius shareholders as milestone payments. Proprius licenses and develops drugs and diagnostics for various forms or arthritis. Its most immediate product candidates include tests that aim to predict whether certain individuals will develop rheumatoid arthritis and that monitor patients’ response to methotrexate, a common treatment for RA.

Vaccinex raises $25M in wake of GSK deal for antibody drugs – Rochester, N.Y.-based Vaccinex, a developer of antibody drugs, raised $25 million in an add-on to its second funding round, VentureWire reports. Investors included Teva Pharmaceutical Industries, Pan Atlantic Bank and Trust and individual investors.

Earlier this month, Vaccinex and its partner EUSA Pharma licensed a Vaccinex antibody to GlaxoSmithKline for up to $44 million plus royalties. Vaccinex and EUSA will split any profits from GSK’s potential sales of the drug.

Cianna Medical receives $9M for breast-cancer radiation treatment – Cianna Medical, an Alisa Viejo, Calif., developer of devices for delivering local radiation in breast cancer, raised $9 million in a first funding round. Fog City Fund, Windamere Venture Partners and several private individuals provided the cash.

Cianna, which was spun out of BioLucent when it was acquired by Hologic last year, is working on new devices for brachytherapy, the general term for temporarily implanting radioactive material at the site of a tumor in order to provide localized radiation treatment. The Cianna device is designed to improve upon existing brachytherapy techniques in breast cancer.

Electron-microscope image provider NanoImaging takes in $1.5M – San Diego’s NanoImaging Services, a provider of imaging services involving transmission electron microscopy, raised $1.5 million in a funding round. Merck Capital Ventures led the round. The company specializes in the characterization of large biological molecules such as proteins, which are used in a variety of products such as vaccines and drugs.

CrystalGenomics, ProQuest Investments create new JV, Palkion – Today’s award for most baffling announcement comes courtesy of CrystalGenomics, an Emeryville, Calif.-based U.S. unit of the Korean drug-discovery company CG Pharmaceuticals, and ProQuest Investments, a New Jersey VC firm, who together have formed a joint venture they’re calling Palkion. Their release is here.

What is Palkion going to do? Beats me. Here’s what the release says:

Under this agreement, CrystalGenomics will receive up to $6 million in upfront and initial research funding from Palkion, in addition to development and sales milestone payments of potentially more than $200 million. CrystalGenomics will also initially own 50% of Palkion, Inc. ProQuest will capitalize Palkion with a Series A investment and also provide the management personnel for Palkion. CG will use its unique structure-based drug design capabilities to identify drug candidates while Palkion will oversee the clinical development of novel drug candidates.

So, let’s get this straight. CrystalGenomics and ProQuest form Palkion, in which they’ll hold equal stakes despite the fact that ProQuest seems to be putting all the capital and personnel into the venture. Palkion will then start handing the money to CrystalGenomics, which will continue trying to discover drugs while Palkion “oversees” the process of testing those drugs in people. All clear?

The best I can figure is that this is a roundabout way of putting a more “American” face on a basically Korean startup that — to judge from its Web site and, in fact, this press release — seems to have a certain amount of difficulty communicating clearly with a U.S. audience. That could certainly be a problem if its drugs make it into clinical trials, given how dialogue with the FDA becomes rather crucial at that stage. But that’s just my guess at this point.

Stealthy biotech Affomic takes in $7M – Affomic, a New Haven, Conn., biotech startup so stealthy that it can announce a funding without giving anyone a clue as to what it’s doing, raised $7 million in a first financing round, peHUB reports. Investors included Connecticut Innovations, Elm Street Ventures, and Four Seasons Ventures. It goes without saying that Affomic doesn’t have a Web site — in fact, the startup doesn’t even exist so far as Google is concerned.

TODAY’S HEADLINES:

• Q Thera takes in $15M for neural stem-cell treatments (release)
• Stroke clotbuster Concentric Medical withdraws IPO (IPOhome)
• Avera recaps with $9M to relaunch human tests of GI drug (VentureWire)
• Tissue repairer Nerites raises $5.7M (release)
• Semafore Pharma aims for $7.5M to launch new cancer-drug trials (VentureWire)
• Triage Wireless gets $6.7M for “cuffless” blood-pressure monitors (peHUB)
• MAKO Surgicals prices IPO, falls in first day of trading (WSJ)
• ImmunoCellular acquires assets of Molecular Antibody Technology (release)

Q Thera takes in $15M for neural stem-cell treatments – Q Therapeutics, a Salt Lake City biotech working on neural stem-cell treatments for neurological conditions, has received the first portion of a $15 million second funding round. Investors in the round included vSpring Capital, Invitrogen, Epic Ventures, Toucan Capital, University of Utah Research Foundation, Salt Lake Life Science Angels and Q management.

Q is taking aim at diseases such as multiple sclerosis and cerebral palsy that result when the protective myelin sheath that protects nerve fibers and the spinal cord deteriorates, often for little-understood reasons. The company is developing neural stem cells that can produce new glial cells, which in theory should be able to regenerate the damaged myelin. (Irritatingly enough, the company insists on calling its product “Q cells.”) The company aims to begin clinical trials in transeverse myelitis, a paralyzing form of MS, next year.

Stroke clotbuster Concentric Medical withdraws IPO – Concentric Medical, a Mountain View, Calif., developer of medical devices for removing stroke-causing blood clots, withdrew its proposed IPO. The company becomes the eighth life-science startup to abandon an IPO this year.

Concentric, of course, cited “unfavorable market conditions” as the reason for its withdrawal. The device maker, which is still unprofitable, reported working capital and cash and short-term investments of $20.3 million at the end of June and has been burning cash at a rate of about $7 million a year, so it’s not necessarily in dire straits. Concentric, in fact, today announced it had arranged a $15 million line of credit with Horizon Technology Finance, giving it an additional cushion.

The company makes and sells a catheter-based device that can be snaked through a patient’s blood vessels to the brain in order to physically “grab” and remove stroke-causing blood clots. Although Concentric won approval for the device in 2004, sales have grown more modestly — in part, perhaps, because Concentric hasn’t undertaken the clinical studies necessary to demonstrate the usefulness of its technique compared to other treatments, and has no plans to do so. (The company listed this point as a risk factor in its SEC filings.) What’s more, the Concentric device can sometimes damage blood vessels in the brain; in one of two studies, almost ten percent of patients suffered a cranial hemorrhage.

Our previous coverage of the company is here.

Avera recaps with $9M to relaunch human tests of GI drug – Avera Pharmaceuticals, a San Diego specialty pharma developing drugs against a variety of conditions, recapitalized with a $9 million “first” funding round, VentureWire reports. Such a recap usually amounts to a restart for a company, which in this case was prompted by a halted clinical trial of a drug for irritable bowel syndrome and overactive bladder.

Investors in the recap included all participants in the company’s previous funding round: Aisling Capital, SV Life Sciences, Aberdare Ventures, BioAsia Investments, H.I.G. Ventures, Montreux Equity Partners, Bay City Capital, BTG PLC, Frazier Healthcare Ventures, InterWest Partners, St. Paul Venture Capital and Windamere Venture Partners. The company declined to provide a valuation to VentureWire, but it’s almost certainly suffered a “down round,” or it wouldn’t be recapitalizing.

Avera shut down mid-stage trials of its drug, known as AV608, last year after animal testing turned up potential toxicity issues. The company has since redesigned the drug to eliminate a compound it called a “non-active metabolite,” and hopes to resume studies later this year. Avera had raised more than $72 million prior to the recap.