Washington Editor

Cerenis Therapeutics SA raised $53.5 million in Series B funding, one of the industry's largest private equity deals this year.

The capital is tabbed for the research and development firm's drug programs in cardiovascular and metabolic diseases, which revolve around the good cholesterol, high-density lipoprotein (HDL). That focus represents the reason for investors' interest in Cerenis, President and CEO Jean-Louis Dasseux said, adding that the funding is expected to get one product through proof-of-concept studies and advance another through Phase I.

"Cardiovascular disease is an expanding market," he told BioWorld Today, noting that increasing HDL is "the only way" to reduce plaque in the body. "A lot of big pharmaceutical companies are looking for HDL products as a way to get a high return on investment for their shareholders."

But with only a handful of such products available, Dasseux said, companies such as Cerenis represent attractive targets for investment. The company, which has operations in Ann Arbor, Mich., and Toulouse, France, has raised $84 million since its inception just a year and a half ago.

Its lead product candidate is a synthetic form of HDL that mimics natural HDL, which facilitates the removal of excess cholesterol from the body. Called Cerenis HDL, it has all the properties of natural HDL.

"That's the difference between our product and what's been developed so far," Dasseux said, noting that existing artificial and mimetic HDL drugs lack certain features of natural HDL. "We believe that in a pathway like reverse lipid transport, it's very important not only to have some of the properties, but all of them," including cholesterol mobilization and transport, enzyme recognition and recognition where excess cholesterol is eliminated.

Cerenis HDL should enter clinical studies by 2008. While the company has kept mum on preclinical findings to date, Dasseux said internal and external reviews indicated that the drug should be "highly competitive." In addition, Cerenis is developing new-generation compounds designed to significantly raise HDL by acting on the peroxisome proliferator activated receptor (PPAR) delta, a mechanism that has the potential to help reduce cholesterol buildup through reverse lipid transport. Dasseux said the lead product from this series also should enter the clinic in 2008.

This PPAR work is done through a licensing agreement giving it North American and European rights from Nippon Chemiphar Co. Ltd., of Tokyo.

Dasseux said it has been important for privately held Cerenis to attract "top-tier" investors from around the world, and this second round of funding has preserved that goal, he added. The financing was led by TVM Capital, based in Munich, Germany, and Boston. Another new investment group participated in this round, OrbiMed Advisors in New York. All the remaining backers were involved in the first round: Sofinnova Partners, of Paris; HealthCap, of Stockholm, Sweden; Alta Partners, of San Francisco; EDF Ventures, of Ann Arbor; and NIF SMBC Ventures, of Tokyo.

That funding ranks among the top 10 largest private rounds this year, according to BioWorld Snapshots.

In other financing news:

• Lumera Corp., of Bothell, Wash., completed its private placement of stock and warrants worth nearly $17 million. The deal included 2.825 million common shares priced at $6 apiece and five-year warrants to purchase 423,750 more shares at $6.25 each. The nanotechnology company designs molecular structures and polymer compounds for the bioscience and communications/computing industries. The transaction was led by Robert W. Baird & Co., of Chicago.

• Yaupon Therapeutics Inc., of Radnor, Pa., raised $4 million in a Series B financing to support the continued development of its clinical programs targeting lymphoma, addiction and neuropathic pain. The specialty pharmaceutical company's lead product, Clearazide, is in a pivotal study for cutaneous T-cell lymphoma. Patient enrollment is continuing for the topically delivered cytotoxic agent. The financing was led by Osage Ventures, of Bala Cynwyd, Pa., and also included the BioAdvance Greenhouse Fund, of Philadelphia; Ben Franklin Technology Partners, also of Philadelphia; and TDH Capital, of Radnor, Pa. In addition to its venture capital backing, Yaupon has received more than $15 million in government support to date.