BioWorld International Correspondent

LONDON - Oxford BioMedica plc is raising £30.1 million (US$51.7 million) in a placing, enabling it to start a Phase III trial of its lead gene therapy cancer treatment TroVax, while continuing efforts to find a partner.

"Over the next few months, we were starting to run into the one-year cash life window," Alan Kingsman, CEO, said to analysts. "It's always been our strategy for this not to happen - it is not a good thing for a biotechnology company fundamentally, but particularly when talking to partners. And even from the point you agree to do a deal with a major company, it can take several months for it to be announceable because of the complexities of contract negotiation."

Kingsman has set the objective of finding a partner for TroVax in 2006.

The fundraising consisted of a placing an open offer of 108.8 million shares at 25 pence per share to new and existing shareholders, with existing shareholders being offered one new share for every 14 existing shares. Another £2.9 million came from Sigma-Aldrich as part of an alliance between the companies in which Sigma-Aldrich will exploit Oxford BioMedica's LentiVector gene delivery technology in the reagent and research tool market.

"We're very pleased with this; it's a good result," Kingsman said. "We're particularly happy to have a substantial increase in our institutional shareholder base - some very big players came [aboard] in this round."

The shares fell 1.75 pence to 28 pence when the fund raising was announced.

TroVax targets the tumor-associated antigen 5T4 that occurs on most solid tumors and generally is associated with a poor prognosis. Oxford, UK-based Oxford BioMedica has selected renal cancer for the Phase III trial of TroVax. Although it is one of the smaller solid-tumor markets, the company said the limited treatment options in that indication will speed progress to registration.

"One important point is that it has been widely accepted in the clinical and regulatory communities that observations made in one indication can be extrapolated to other indications," Kingsman said.

Last week dosing began in a U.S. Phase II trial of TroVax in combination with interleukin-2 in treating renal-cell carcinoma. The open-label trial is expected to recruit up to 25 patients.

Oxford BioMedica previously has said that it would not fund Phase III trials, but has decided to do so on the basis of recent results of a Phase IIb trial in metastatic colorectal cancer in which TroVax was administered with chemotherapy. All patients mounted a T-cell response, and of those, 70 percent were cytotoxic T-cell responses (CD-8).

"This is one key element that has dramatically changed the way pharma companies are looking at TroVax," Kingsman said. "These are the sorts of levels of CD-8 you get in infectious disease, and that is focusing attention on TroVax as the lead product in the cancer vaccine field."

The company will not finance all of Phase III. "But given the results in our hands today, it is reasonable to move into Phase III," Kingsman said. "We don't want to put TroVax on the shelf while we find a partner - that would be a sign of weakness and delays getting the product on the market."