Preparing to start Phase II testing of its oral glaucoma drug, Danube Pharmaceuticals Inc. raised a little more than $10 million in its first financing round.

The New York-based company was founded last year by venture capital firm Two River Group Holdings LLC based on technology surrounding DNB-001, a compound licensed from an undisclosed entity. DNB-001 is expected to begin a Phase II trial in the UK during the third or fourth quarter of this year, said David Tanen, co-founder and partner at Two River and interim president of Danube.

Funds from the Series A round, expected to sustain the company for about three years, also will go toward recruiting a CEO and management team and beginning the process for acquiring additional compounds, possibly in the ophthalmic or central nervous system space, to fill out Danube's pipeline.

The third company created by Two River, Danube continues the "river" theme, its name coming from the second longest river in Europe. It joins Bonita Springs, Fla.-based Tigris Pharmaceuticals Inc., which was founded last fall and began Phase II testing in April of A-007, a topical gel, in high-grade cervical intraepithelial neoplasia associated with the human papillomavirus. More recently, Two River established Nile Pharmaceuticals Inc., a New York-based company to develop a cardiovascular drug licensed from the Mayo Clinic. Nile's drug is about to enter Phase I.

Rather than simply investing in a portfolio of biotech firms, Two River "is in the business of creating new companies to in-license drugs to treat unmet medical needs," Tanen said. "And we're very selective about the compounds we choose."

Danube's compound caught the attention of Two River's partners after preclinical testing in animal models suggested efficacy in lowering intraocular pressure (IOP) and a 79-patient Phase I study demonstrated the drug's tolerability at all dose levels.

DNB-001 "appears to have a dual mechanism of action," Tanen said.

In preclinical studies, the drug demonstrated a reduction in IOP that was comparable to standard-of-care treatment with prostaglandin analogs, such as Xalatan from New York-based Pfizer Inc., while it also appeared "to provide some neuroprotection to the optic nerve," Tanen said.

"There are really no marketed products with dual protection," he added, "and we think an oral product will be well accepted" since many patients have a hard time administering topical eye drops.

Although there are oral products on the market, most are associated with a number of side effects that limit their use.

"We're hoping that, if successfully developed, this could command a substantial portion of what is a $3 billion market," Tanen told BioWorld Today.

That market already has generated some big news. Earlier this year, Sophia-Antipolis, France-based NicOx SA signed a potential $400 million deal with Pfizer to develop ophthalmic products using NicOx's nitric oxide-donating technology. That collaboration expanded on an earlier partnership that yielded a promising preclinical glaucoma compound. (See BioWorld Today, March 3, 2006.)

In fact, it was NicOx's deal with Pfizer "that cemented the validity of the market for us," Tanen said.

Beyond glaucoma, DNB-001 also might be a potential therapy in cardioprotection, as well as neuroprotection in conditions such as stroke and diabetic neuropathy.

Danube likely will look for its own partnership down the road to commercialize DNB-001, but for now, the company is focusing on the upcoming clinical work.

"Our plan is to complete Phase II and see where we are from there," Tanen said.

The Series A funding included investments from undisclosed institutional investors. Riverbank Capital Securities Inc., of New York, acted as placement agent.

In other financings news:

• BiPar Sciences Inc., of Brisbane, Calif., secured a $5 million venture debt commitment from Lighthouse Capital Partners, of Menlo Park, Calif., for accelerating and expanding the clinical program for its lead compound, BSI-201, and moving two additional compounds toward the clinic. BSI-201, a poly-ADP-ribose polymerase inhibitor, is a targeted cancer therapy designed to selectively induce tumor cell death. Initial studies are evaluating safety and pharmacokinetic activity of the drug, and BiPar has plans for Phase Ib trials later this year to test BSI-201 in combination with other agents.

• Bridge Pharmaceuticals, of San Francisco, closed a $22 million Series B round, with participation from returning Series A investors and new U.S.-based venture and banking investors. Money will be used to fund development of Bridge's core business and provide funds for future potential acquisitions in Asia. Bridge, a spin-off of SRI International, is a preclinical contract research organization.

• Clinical Data Inc., of Newton, Mass., raised about $17 million through a private placement of 1.04 million shares of common stock and warrants to purchase 519,889 shares. Proceeds will be used for general working capital purposes, launching its clozapine-induced agranulocytosis and warfarin response test and executing its previously announced restructuring activities. Last month, Clinical Data agreed to spin off its Phase III-stage depression drug, vilazodone, into newly created firm Precigen Therapeutics Inc. Proceeds from the financing also could support the development or potential in-licensing of clinically relevant biomarkers in several therapeutic classes. (See BioWorld Today, May 16, 2006.)