Anacor Pharmaceuticals Inc. capped off a busy month for IPO filings Friday, becoming the 10th biotech to file for an initial public offering in August.

Anacor's proposal to raise up to $57.5 million followed bids from ARYx Therapeutics Inc., Adnexus Therapeutics Inc., Insys Therapeutics Inc., Precision Therapeutics Inc., Biolex Inc., Nanosphere Inc., Peplin Inc., Reliant Pharmaceuticals Inc. and Genoptix Inc.

Proceeds from Anacor's offering will support the Palo Alto, Calif.-based company's development of topically-administered small molecules derived from its boron chemistry platform. A naturally occurring element found in coffee, vegetables and other sources, boron has unique properties that allow it to bind and interact with biological targets differently than traditional carbon-based compounds.

The lead boron-based compound in Anacor's pipeline is AN2690, a topical antifungal for toenail onychomycosis. The drug, which has completed three Phase II trials, interferes with fungal protein synthesis by targeting leucyl-transfer RNA synthetase.

AN2690 caught the eye of Schering-Plough Corp. earlier this year. The big pharma gained exclusive worldwide rights to the product in all indications by paying $40 million up front and agreeing to make a future $10 million investment in Anacor, pay up to $505 million in onychomycosis milestones, shell out double-digit royalties and allow Anacor to co-promote the drug to U.S. dermatologists. Schering also assumed responsibility for development of AN2690, which is expected to begin Phase III trials next year. (See BioWorld Today, Feb. 5, 2007.)

Behind AN2690 is AN2728, a topical anti-inflammatory that inhibits TNF-alpha and other cytokines. A Phase Ib trial in psoriasis showed that AN2728 significantly reduced the thickness of psoriatic lesions compared to a control, demonstrating efficacy similar to the topical steroid betamethasone but with no treatment-related adverse events. Anacor intends AN2728 to be the first TNF-alpha inhibitor that is not a steroid and thus is not associated with the side effects of steroid treatment, but at the same time is topically rather than systemically administered and thus is not associated with liver toxicity or immune suppression.

An additional Phase Ib trial and a parallel Phase II trial of AN2728 are slated to begin later this year.

Another drug that has completed Phase Ib is AN0128, a combination anti-inflammatory and antibacterial that showed activity similar to the antibiotic clindamyacin in eliminating the bacteria responsible for acne. AN0128 also may be useful in fighting the bacteria associated with gingivitis. And in preclinical development is AN2718, a topical treatment for vaginal candidiasis, or yeast infections, and tinea pedis, or athlete's foot. Anacor expects to file investigational new drug applications for both indications next year.

In addition to funding clinical programs, Anacor may use the proceeds of its IPO to increase working capital and to provide funds for general corporate purposes. Since its founding in 2002, the company has accumulated a deficit of $48.4 million. Cash and equivalents as of June 30 totaled $34.9 million.

Some proceeds also may be used to pay off the $8 million in debt Anacor has borrowed. The rest of the company's financing has come through a combination of equity, grants and partnership revenue. Aggregate net proceeds from the issuance of equity have totaled $37.6 million, while government contract and grant revenues brought in $17.1 million, and the Schering deal has so far generated $40 million.

Top external shareholders in Anacor prior to the offering include Rho Ventures, Venrock Associates, Care Capital and Aberdare Ventures.

Morgan Stanley & Co. Inc. is serving as the sole bookrunner for Anacor's offering, with Cowen and Co. LLC serving as co-lead manager. Pacific Growth Equities LLC and Needham & Co. LLC are acting as co-managers. Anacor applied to list its shares on the Nasdaq Global Market under the ticker symbol "ANAC."