Early-Stage Pharmas Raise Substantial First Rounds (September 15, 2006)

Three of the five largest venture capital deals announced during August were Series A financings, while the other two were investments in Europe-based companies. In the largest deal, Esprit Pharma, a pharmaceutical company focused on the areas of urology and women's health care, secured $91 million in its first round, from New Enterprise Associates, Apax Partners, Domain Associates, Montagu Newhall Global Partners, Oak Investment Partners and other investors. In the year since its inception, Esprit has built a commercial organization of more than 200 people and acquired four approved products, and will use this Series A funding to support the continued execution of its business plan. In the second-largest deal, Zogenix, Inc. raised $60 million in Series A financing from Clarus Ventures, Domain Associates (co-leads), BA Venture Partners, Thomas, McNerney & Partners and Life Science Angels. Zogenix, a pharmaceutical company that has assembled its founding management team, will use the funding for the acquisition of Intraject technology assets from Aradigm, Inc. and for the clinical and commercial development of Intraject sumatriptan, the first needle-free, single-use, disposable, subcutaneous delivery system, for migraines. In the first of the two European deals, Ablynx raised $50 million from KBC Private Equity (lead), SR One (USA & UK), Abingworth Management (UK), Alta Partners, Biotech Fund Flanders, Gilde Healthcare Partners, GIMV, Sofinnova Partners and VIB. Ablynx, a biopharmaceutical company based in The Netherlands, is focused on the discovery and development of nanobodies, a novel class of antibody-derived therapeutic proteins with potential applications in Alzheimer’s, inflammation, thrombosis and oncology. Ablynx will use the proceeds of the Series C financing to fund its operations through at least mid-2008. A biotechnology company headquartered in Switzerland, ESBATech AG, announced the next-largest deal, with $41 million in funding from SV Life Sciences, Clarus Ventures, HBM BioVentures, HBM BioCapital, Novartis Ventures, BioMedinvest and VI Partners. ESBATech, a developer of antibody fragment therapeutics, is using the proceeds of the Series B financing to continue the development of its lead product for several inflammatory indications, as well as to progress additional antibody fragment candidates into clinical development during the next three years. In the other initial-round deal, Intranasal Therapeutics, Inc. (ITI) raised $39.1 million from SV Life Sciences, Burrill & Company, Tullis-Dickerson, Fidelity Biosciences, Apjohn Ventures, Fort Washington Capital, Commonwealth Seed Capital and Kentucky Co-Investment Partners. Focused on developing nasally delivered, preservative-free pharmaceutical products, ITI will use the proceeds of the Series A financing to launch its proprietary hydromorphone nasal spray for acute pain and to continue trials of its intranasal formulation of lorazepam, a benzodiazepine used for treating seizures and anxiety.

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