If the story of newly established Relypsa Inc., a company created to develop nonabsorbed polymeric drugs for renal and cardiovascular diseases, sounds more than a little familiar, that's probably because it is.

The Santa Clara, Calif.-based firm, which just completed a $33 million Series A round, was spun out of Amgen Inc.'s acquisition of Ilypsa Inc. The new company is based on the platform technology and early stage pipeline of Ilypsa, a firm founded in 2003 to develop polymeric drugs with the aim of providing improved safety by avoiding absorption into the bloodstream. Amgen, of Thousand Oaks, Calif., bought the privately held firm in June for $420 million, primarily to gain rights to ILY101, a phosphate binder that has completed a dose-ranging Phase II study in chronic kidney disease patients on dialysis. (See BioWorld Today, June 6, 2007.)

Amgen's "interest was mainly around that late-stage asset," said Gerrit Klaerner, a former executive of Ilypsa and now senior vice president and chief operating officer for the new firm. Following the buyout, Ilypsa's management entered discussions with Amgen about how to preserve "the Ilypsa momentum and people, and all parties realized" the advantage of spinning out certain assets into a new company.

While Amgen retains ILY101, now AMG 223, Relypsa gets the high-throughput screening platform used to discover nonabsorbed polymeric drugs, as well as early pipeline programs, including ILY-105, a potassium binder that's set to enter the clinic early next year. Relypsa also has "been able to offer jobs to 48 Ilypsa employees," and negotiate terms for the office and lab space that previously housed Ilypsa, Klaerner said. "We just changed the signs outside."

The rest of Relypsa's management team, like Klaerner, is comprised of former Ilypsa executives, including CEO Jay Shepard, Chief Medical Officer Detlef Albrecht and Chief Scientific Officer Jerry Buysse.

"It's a fantastic opportunity that Amgen's allowed us," Klaerner told BioWorld Today. The big biotech retains a minority equity stake in Relypsa and has certain rights related to the transferred programs.

Completion of the Series A financing, led by 5AM Ventures and New Leaf Venture Partners, both of Menlo Park, Calif., positions the company to move forward on its lead program. ILY-105 aims at treating hyperkalemia, a condition caused by elevated potassium levels, in chronic kidney disease patients. Funding should take the company into 2009, enabling Relypsa to get through proof-of-concept studies with that compound, as well move a second product into the clinic, Klaerner said.

Behind ILY-105, Relypsa has a backup potassium binder candidate and a sodium binder program for potential treatment of congestive heart failure.

Relypsa's partnering strategy likely will be similar to its predecessor, which was selective in its deal making. At the time of its acquisition, Ilypsa retained most of the rights to its lead program, though it had licensed Japanese rights to ILY101 to Tokyo-based Astellas Pharma in exchange for $22 million up front, up to $70 million in potential milestones and royalties in the mid-teen range.

"That was a good deal for us," Klaerner said. With Relypsa, "our idea is that we will be able to do partnering in certain indications.

"We're going to try to do Ilypsa all over again," he added. Ilypsa "was a 4-year-old company that raised $46 million and was bought out for $420 million. So that's our goal: to be as successful as Ilypsa."

Other Series A investors include: the Sprout Group, of New York; Delphi Ventures, of Menlo Park, Calif.; CMEA Ventures, of San Francisco; and Mediphase Venture Partners, of Newton, Mass. All of those firms previously had invested in Ilypsa.

Scott Rocklage, of 5AM, will serve as chairman, and Relypsa board members include Vijay Lathi, of New Leaf; Deepa Pakianathan, of Delphi; Shepard; and Jay Hagan of Amgen Ventures.