Portfolio News
Ocera gets $35.5M
The Deal.com
George White
20 February 2008
Biopharmaceutical company Ocera Therapeutics Inc. has closed a $35.5 million Series C financing that will enable it to push its lead drug candidate for treatment of Crohn's disease through Phase 3 clinical trials.
The San Diego company tapped new investor Montagu Newhall Associates Inc. of Palo Alto, Calif., to lead the round. Other newcomers included InterWest Partners of Menlo Park, Calif., AgeChem Venture Fund of Montreal, Cross Creek Capital of Salt Lake City, FinTech GIMV Fund LP of Japan and CDIB BioScience Venture Management of San Diego. Existing stakeholders Domain Associates LLC of Princeton, N.J., and Thomas, McNerney & Partners and Sofinnova Ventures, both of San Francisco, also participated in the round.
The proceeds will primarily go toward putting the lead drug candidate, AST-120, through Phase 3 trials for treatment of Crohn's, a chronic inflammatory bowel disease that affects the bowel or intestines.
Ocera has raised $62 million in venture funding since its founding in 2005 by Eckard Weber of Domain Associates, an early-stage investment firm specializing in life sciences, and company president and CEO Laurent Fischer to in-license and develop compounds to treat a range of gastrointestinal and liver diseases. The company previously raised a $12 million Series B round in July 2006 and a $14.5 million Series A in January 2006.
Fischer said that if all goes well, "We think the drug could be on the market in the 2011-2012 time frame, conservatively."
Crohn's is estimated to afflict more than 500,000 people in the U.S., and 4 million worldwide. "The market for Crohn's disease treatment is estimated at well over $1 billion and should be over $1.8 billion by the time we launch the product," Fischer said.
Ocera licensed AST-120 in 2005 from Kureha Corp. of Japan and gives Ocera the rights to develop the drug for treatment of Crohn's in North America, Europe and Israel. Ocera also is discussing partnerships with several large pharmaceutical companies in the gastrointestinal industry to distribute and market the compound, although Fischer said "our intent is to retain co-marketing rights for the U.S. market."
Fischer said Ocera raised the latest funding expecting that, should clinical trials go well, the company could conduct an initial public offering in the second half of this year or strike a partnership that would provide additional capital.
"The money will also accelerate the development of AST-120 into a new indication for Pouchitis, an orphan drug indication for which there are no drugs approved today," Fischer added. AST-120 is in Phase 2 trials for Pouchitis and has also been initiated for proof-of-concept trials in irritable bowel syndrome, hepatic encephalopathy and persistent gastro-oesophageal reflux disease. Under the new funding, Linda Grais of InterWest Partners will sit on Ocera's board of directors. Michael Sanders and Deborah Gunny of Reed Smith LLP provided counsel to Ocera in the financing, while the investors received legal advice from Duane Morris LLP.
Biopharmaceutical company Ocera Therapeutics Inc. has closed a $35.5 million Series C financing that will enable it to push its lead drug candidate for treatment of Crohn's disease through Phase 3 clinical trials.
The San Diego company tapped new investor Montagu Newhall Associates Inc. of Palo Alto, Calif., to lead the round. Other newcomers included InterWest Partners of Menlo Park, Calif., AgeChem Venture Fund of Montreal, Cross Creek Capital of Salt Lake City, FinTech GIMV Fund LP of Japan and CDIB BioScience Venture Management of San Diego. Existing stakeholders Domain Associates LLC of Princeton, N.J., and Thomas, McNerney & Partners and Sofinnova Ventures, both of San Francisco, also participated in the round.
The proceeds will primarily go toward putting the lead drug candidate, AST-120, through Phase 3 trials for treatment of Crohn's, a chronic inflammatory bowel disease that affects the bowel or intestines.
Ocera has raised $62 million in venture funding since its founding in 2005 by Eckard Weber of Domain Associates, an early-stage investment firm specializing in life sciences, and company president and CEO Laurent Fischer to in-license and develop compounds to treat a range of gastrointestinal and liver diseases. The company previously raised a $12 million Series B round in July 2006 and a $14.5 million Series A in January 2006.
Fischer said that if all goes well, "We think the drug could be on the market in the 2011-2012 time frame, conservatively."
Crohn's is estimated to afflict more than 500,000 people in the U.S., and 4 million worldwide. "The market for Crohn's disease treatment is estimated at well over $1 billion and should be over $1.8 billion by the time we launch the product," Fischer said.
Ocera licensed AST-120 in 2005 from Kureha Corp. of Japan and gives Ocera the rights to develop the drug for treatment of Crohn's in North America, Europe and Israel. Ocera also is discussing partnerships with several large pharmaceutical companies in the gastrointestinal industry to distribute and market the compound, although Fischer said "our intent is to retain co-marketing rights for the U.S. market."
Fischer said Ocera raised the latest funding expecting that, should clinical trials go well, the company could conduct an initial public offering in the second half of this year or strike a partnership that would provide additional capital.
"The money will also accelerate the development of AST-120 into a new indication for Pouchitis, an orphan drug indication for which there are no drugs approved today," Fischer added.
AST-120 is in Phase 2 trials for Pouchitis and has also been initiated for proof-of-concept trials in irritable bowel syndrome, hepatic encephalopathy and persistent gastro-oesophageal reflux disease.
Under the new funding, Linda Grais of InterWest Partners will sit on Ocera's board of directors. Michael Sanders and Deborah Gunny of Reed Smith LLP provided counsel to Ocera in the financing, while the investors received legal advice from Duane Morris LLP.