Biopharmaceuticals company Phenomix withdrew its filing to go public yesterday and right away announced a $340-million collaboration deal with Forest Laboratories. The IPO, intended to raise $86.3 million, had been pending since January.

Forest will aid the San Diego-based firm in the development of its diabetes treatment, dutogliptin, which is currently in its third phase of clinical trials. The deal represented $75 million for the company up front, with potentially more to come as the drug nears commercialization. The agreement gives Forest exclusive marketing rights in Canada and Mexico, while Phenomix reserves the rights to everything outside of North America.

Phenomix raised $73.3 million in a third round of venture capital earlier this year and $141 million total since its inception in 2002. Past backers have included Alta Partners, Baker Brothers Investments, Bay City Capital, CM Capital Investments, CMEA Ventures, Delphi Ventures, GBS Venture Partners, JP Morgan Partners, Nomura Phase IV Ventures, Novartis Venture Fund, Rothschild Bioscience Managers, Sofinnova Ventures and Versant Ventures.

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