A day after picking up worldwide rights to a Phase II-stage insulin sensitizer, new company InteKrin Therapeutics Inc. closed its first institutional financing round of $23 million.

The Palo Alto, Calif.-based firm expects to use the proceeds to support further clinical development of INT131, an oral peroxisome proliferators-activated receptor (PPAR) gamma-selective modulator and partial agonist for Type II diabetes just licensed from Amgen Inc. Funds should take development through Phase IIb trials, while also allowing the company to continue building its drug pipeline in diabetes, obesity and metabolic disorders.

"We should be able to execute everything we have on the table out to about three years," said President and CEO Denny Lanfear. He's a former Amgen executive who co-founded InteKrin in 2005 with clinical endocrinologist Christos Mantzoros, a professor of medicine at Harvard Medical School. The company's investors have "given us plenty of driving power going forward," Lanfear said.

San Francisco-based Sofinnova Ventures led the financing, which included investments from New York-based Orbimed Advisors and Palo Alto, Calif.-based Vivo Ventures, as well as existing investors Asset Management Co., also of Palo Alto, Calif., and Sears Capital Management, of Los Altos, Calif.

InteKrin - so named, Lanfear said, as a "play on the word endocrine,'" with an emphasis on the concept of integrated metabolic insights - aims to in-license compounds "with a high degree of scientific sophistication" and a big market potential. As its first compound, the company selected INT131 (formerly AMG131), a diabetes candidate Thousand Oaks, Calif.-based Amgen gained in 2004 via its $1.3 billion acquisition of South San Francisco-based Tularik Inc. The product was taken through Phase IIa studies, but was outside Amgen's strategic focus. (See BioWorld Today, March 30, 2004.)

INT131 is an oral therapy designed to lower blood glucose in diabetic patients by improving the body's ability to respond to insulin. The compound targets PPAR-gamma, a receptor involved in regulating the body's ability to respond to insulin. But unlike the marketed PPAR-gamma agonists, namely Actos (pioglitazone, Eli Lilly & Co.) and Avandia (rosiglitazone, GlaxoSmithKline plc), INT131 is only a partial gamma agonist. Because it does not agonize the full receptor, "it doesn't turn on a lot of the genes associated with the side effects" of full PPAR-gamma agonists, such as weight gain and edema, Lanfear said.

Its activity also has suggested that "it's very well positioned for the pre-diabetes market," he told BioWorld Today, adding that recent studies have shown "that the onset of diabetes can be substantially delayed by treatment with PPAR-gamma agonists."

The PPAR agonist approach is popular in the Type II diabetes space, with several companies working on their own versions, such as Hayward, Calif.-based Metabolex Inc., which is in a Phase II/III study of metaglidasen, a PPAR-gamma modulator. That drug, along with follow-on candidate, MBX-2044, is partnered with Ortho-McNeil Inc., a unit of New Brunswick, N.J.-based Johnson & Johnson. Plexxikon Inc., of Berkeley, Calif., also is in Phase II with PLX204, a PPAR pan agonist that is partnered with Wyeth Pharmaceuticals, of Madison, N.J.

InteKrin plans to move into Phase IIb testing with INT131, and Lanfear said the study likely will involve a 12- to 16-week trial period and be designed so that, pending positive results, "we could move straight forward in a pivotal Phase III."

Because Type II diabetes presents such a large market, the company plans to seek a partner at or before the start of Phase III.

With the recent funding, InteKrin expects to increase its work force to a half dozen employees by the end of the month. But Lanfear said it's the scientific advisory board that will be most instrumental in the company's growth, especially regarding clinical development and future in-licensing opportunities.

The SAB includes company co-founder Mantzoros, Alexander DePaoli, Jeri El-Hage, Steven Kliewer, David Orloff and Gerald Reaven.

In connection to the financing, Jim Healy, of Sofinnova, joined InteKrin's board of directors, along with Sam Wertheimer, of Orbimed, and Barry Selick, CEO of Redwood City, Calif.-based Threshold Pharmaceuticals and a Sofinnova Venture partner. The board is chaired by Lowell Sears, of Sears Capital Management, and also includes Paul Truex, CEO of San Mateo, Calif.-based Anthera Pharmaceuticals Inc.