AlphaVax Inc. completed a $12.7 million Series E round of financing to help fund development of its vaccine products for infectious diseases and other indications.

The Research Triangle Park, N.C., company, founded in 1997, has brought in the majority of its funding to date from grants and other non-equity sources. Its focus is on use of a viral vector system to make alphavirus replicon vaccines called alphavaccines, which have demonstrated protection in models for infectious diseases and cancer.

AlphaVax last week got FDA approval to begin clinical testing of vaccines developed with the alphavaccine technology for influenza and cytomegalovirus. Testing is expected to begin over the next few months. Both projects are funded in part by grants from the National Institute of Allergy and Infectious Diseases.

AlphaVax previously reported data from a Phase I trial suggesting an HIV vaccine incorporating the HIV gag gene made with its technology induced an antibody response to the HIV gag antigen in 100 percent of those who received the highest dose tested.

The AlphaVax pipeline is targeting pandemic influenza and cytomegalovirus, as well as grant and collaborator-supported programs in HIV, prostate and breast cancer, and several biodefense vaccines.

U.S. government-supported funding for biodefense applications of the vaccine technology includes early development programs for the Marburg virus, viral encephalitis, botulinum toxins and smallpox. The four biodefense-related programs are the subject of more than $23 million in funding support for AlphaVax.

AlphaVax's lead program is an HIV vaccine program being developed in collaboration with the National Institutes of Health and the South African Medical Research Council. It is being supported by more than $35 million in non-equity funding, not including the cost of its Phase I clinical trial activities.

Among AlphaVax's corporate partners is Madison, N.J.-based Wyeth, which has rights to use alphavirus vector technologies to develop vaccines in certain disease fields. The original deal from 1998 was amended a year ago to refocus the disease areas and provide Wyeth exclusive access to AlphaVax technologies on those undisclosed areas. Wyeth made an equity investment in AlphaVax as part of that deal.

Work in cancers is being done with academic collaborators.

The alphavaccines system is genetically derived from a modified alphavirus. The company re-engineers a virus, substituting a gene from an infectious disease or cancerous cell for a portion of the original viral genome. The re-engineered alphavaccine particles then are designed to express the substituted gene (or genes) rather than producing more virus particles, transforming the original virus into a vaccine system.

AlphaVax said a majority of the Series E funding was provided by existing investors. Further details were not disclosed. AlphaVax officials were not available for comment.

In other financing news:

• Allos Therapeutics Inc., of Westminster, Colo. closed a previously announced sale of 9 million shares at $6 per share. Net proceeds were $50.5 million. (See BioWorld Today, Jan. 31, 2006.)

• Chromos Molecular Systems Inc., of Burnaby, British Columbia, said it intends to raise about C$8 million (US$6.8 million) through a private placement of units at $0.15 per unit. Each unit will include one common share and half a warrant. Each five-year whole warrant would entitle the holder to purchase one at C$0.20 per share. The deal is co-led by Dundee Securities Corp., Canaccord Capital Corp. and Clarus Securities Inc.

• Point Therapeutics Inc., of Boston, priced a registered direct offering of 6.52 million shares of stock at 73 cents per share for proceeds of about $4.76 million. Investors also will receive five-year warrants to purchase an additional 978,566 shares at an exercise price of $1 each. The company intends the funds to support further development of talabostat and for general corporate purposes. The company's largest investor, Federated Kaufmann Fund, participated in the transaction. Rodman & Renshaw LLC was the sole placement agent. The company's stock (NASDAQ:POTP) fell 11 cents Friday, or 12.8 percent, to close at 75 cents.

• Shogoo Pharmaceuticals KK, of Tokyo, raised 1.6 billion yen (US$13.6 million) in a Series A financing round. The round was led by seed investors Atlas Venture and NIF SMBC Co. Ltd. and new investor Nomura Research and Advisory Co. Ltd. Funds will be used for preclinical and clinical development of the antiviral agent SPK-0601 and the antibiotic agent SPK-0602, a polyenic macrolide. The company was founded in October 2005.

• Stem Cell Therapeutics Corp., of Calgary, Alberta, raised C$2 million (US$1.7 million) in a private placement of 10 million units. Each consists of one share and one-half of a warrant. Each full warrant entitles the holder to purchase one common share at C$0.25 for two years. SCT also said it granted five-year options to company directors and officers to acquire up to 900,000 common shares at C$0.34 per share. There are now options outstanding to purchase about 5.7 million SCT shares.

• Vertex Pharmaceuticals Inc., of Cambridge, Mass., said that on March 5 it will redeem the outstanding $59.6 million of 5.75 percent convertible senior subordinated notes due 2011. Since Vertex's stock currently is trading above the conversion price, it expects that note holders will convert them into common stock at a conversion rate of $14.94 per share rather than accept redemption. The notes may be converted until March 2. If all notes are converted, Vertex will issue about 4 million shares of common stock, increasing the company's total shares outstanding to about 130 million.