Logical Therapeutics Inc., which develops drugs for diseases associated with or caused by inflammation, raised $30 million in its Series B round to push its early stage pipeline through proof-of-concept trials, starting with a naproxen prodrug aimed at chronic pain.

It's the largest financing for the company, which brought in an undisclosed seed in mid-2006, and is expected to sustain operations through 2010, said Carolyn Green, chief operating officer. "It should get us through multiple Phase II trials" with lead product, LT-NS001, and allow the company to advance programs in its preclinical pipeline, she said.

LT-NS001 is a prodrug of naproxen, the widely used nonsteroidal anti-inflammatory agent found in marketed pain products such as Aleve. But as a prodrug, LT-NS001 is designed to avoid the gastrointestinal side effects than can be caused by drugs in the NSAID class. The product is formed as a new chemical entity that "doesn't convert to naproxen until it gets to the bloodstream," Green told BioWorld Today. "So the stomach never sees naproxen."

Green said about 200,000 people are hospitalized each year for NSAID-induced gastrointestinal distress, and more than 16,000 people die as a result of GI bleeds. While that's a relatively small number when compared to the overall NSAID market, "we think it's a significant public health problem."

Reducing the GI side effects also was the intent of Vioxx, a COX-2 selective NSAID from Whitehouse Station, N.J.-based Merck & Co. Inc. Though approved in 1999, reports of an increased risk in heart attack and stroke in chronic users prompted Merck to voluntarily withdraw Vioxx from the market in 2004. Logical's drug is designed so that it has the "same GI profile as Vioxx," Green said, "but without introducing new cardiovascular implications."

Preclinical testing in rats and dogs showed that the drug caused significantly less damage to the GI tract than equivalent doses of naproxen. LT-NS001 has completed initial Phase I development, and the company expects to conduct a Phase Ib dosing trial later this year before starting the first of multiple Phase II studies next year.

Whether the company will seek a partner for late-stage development and commercialization remains to be seen. "We're leaving all avenues open," Green said.

Beyond LT-NS001, Logical has a preclinical pipeline targeting inflammatory diseases, as well as diseases that involve inflammatory elements. Green, who co-founded the company with Mitchell Fink, said the company's work revolves around the discovery that inflammation might be one of the "previously unrecognized factors of many diseases, [such as] cardiovascular diseases and metabolic diseases. So we're trying to find interesting new ways to treat those."

In preclinical development, the company has an oligopeptide aimed at treating metabolic syndromes by targeting inflammatory-mediated leptin-resistance. Leptin, the so-called satiety hormone, is responsible for signaling the brain to regulate appetite, and Logical believes that obese patients suffer from leptin resistance due to inflammation, Green said.

"We're developing a drug we believe will interfere with that inflammation to restore leptin's natural ability." She added that studies in mice had demonstrated the drug's ability to reduce body weight and eliminate Type II diabetes.

Another program in preclinical development is a tetrapeptide targeting TNFR1 (tumor necrosis factor with its primary receptor), the same target addressed by blockbuster drugs Humira (Abbott Laboratories), Enbrel (Amgen Inc.) and Remicade (Centocor Inc.) for rheumatoid arthritis and other diseases. Those products must be administered by either infusion or injection, so Logical's approach involves creating an oral peptide that provides the same effect with more convenient dosing, Green said.

Both preclinical programs were in-licensed from the University of Pittsburgh.

Logical was "very pleased with the group of investors" in its Series B round. SV Life Sciences, of Boston and San Francisco, led the financing, with participation from Burrill & Co., of San Francisco, Novo A/S, of Bagsvaerd, Denmark, and Sigvion Capital, of Chicago. Existing investor PA Early Stage Partners, of Wayne, Pa., which provided the company's seed funding, also participated.

Logical, which currently is based in Pittsburg, is preparing to relocate its corporate headquarters to the biotech hub of Boston next quarter.

In other financings news:

• Astion Pharma A/S, of Copenhagen, Denmark, received DKK50 million (US$8.9 million) from existing shareholders to accelerate Phase III development of ASF-1096, an R-enantiomer of salbutamol formulated as a topical cream to treat cutaneous lupus. The company said it has advanced with ongoing Phase II studies, and expects to begin Phase III in the next six to 12 months, about six months earlier than originally anticipated. The capital infusion ensures that the company will be able to proceed with ASF-1096 without having to delay development of its other pipeline candidates, including ASF-1057, a drug in Phase II development for seborrheic dermatitis.

• Auxilium Pharmaceuticals Inc., of Malvern, Pa., closed its offering of 3.7 million shares priced at $14.50 each for net proceeds of $49.9 million. Those funds are expected to be used for general corporate purposes, including working capital, product development and capital expenditures. Banc of America Securities LLC and Thomas Weisel Partners LLC served as placement agents. (See BioWorld Today, June 11, 2007.)

• Tapestry Pharmaceuticals Inc., of Boulder, Colo., withdrew its registration statement filed in April for a proposed $40 million offering of common stock. The company said its decision followed encouraging oncology data presented at two recent conferences, and that given its financial position, it has opted to "consider other financing options." Shares of Tapestry (NASDAQ:TPPH) gained 9 cents Wednesday to close at $1.84.

• WaferGen Biosystems Inc., of Fremont, Calif., completed a second closing of a private placement of stock and warrants to bring the total proceeds to $12 million. The company, which develops systems for gene expression, genotyping and stem cell research, expects to use funds to market its SmartSlide products, which allow time-lapse imaging studies to characterize, differentiate and proliferate difficult-to-cultivate cells, and to develop the SmartChip System for high-throughput, whole-genome analysis without advanced preparation of reagents. WaferGen named Joel Kanter and R. Dean Hautmaki to the board of directors and appointed Eugene Bauer as chairman of its scientific advisory board.