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Two Biotechs Hit Jackpot
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Business New Haven
7/7/2003
By: Richard Rangoon
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Two privately owned biotechnology companies in New Haven - Rib-X Pharmaceuticals and Sopherion Therapeutics - have attracted recent infusions of capital noteworthy even by the standards of California and Massachusetts, according to Paul Pescatello, president of Connecticut United for Research Excellence (CURE), the trade group that represents biotech companies in Connecticut.
In May Rib-X announced completion of a $63.5 million Series B preferred stock financing. Since its 2000 inception, the company has raised $73 million.
Sopherion's research focuses on developing new anti-infectives for physicians to address resistant organisms.
New investor Warburg Pincus led the Series B financing with a $31 million investment (BNH, June 23). Previous Sopherion investors likewise participated, including: Axiom Ventures, Cardinal Partners, Connecticut Innovations Inc. (CII), Euclid SR Partners, Oxford Bioscience Partners, S.R. One, Limited and Zero Stage Capital.
According to Pescatallo, investors are looking at the track records of companies, progress made on certain compounds, and the likelihood of compounds becoming marketable drugs.
Another factor affecting investment is the recent surge in collaboration between biotechnology companies. Through pooling their resources and fulfilling complementary roles, biotechs are boosting their appeal, said Pescatello.
Founded in 2000, Rib-X has 48 employees, 40 of whom are researchers.
Also in New Haven, Sopherion Therapeutics has raised $26 million in Series A funding led by TL Ventures. Other investors included HealthCap KB, ProQuest Investments, Johnson & Johnson Development Corp., Intersouth Partners, Seaflower Ventures, CII and GE Life Science & Technology Finance.
Sopherion has developed two compounds that attack cancer cells while bypassing healthy tissue, explains company spokeswoman Jacqueline Franchetti. The compounds battle advanced-stage cancer ordinarily addressed solely with chemotherapy or radiation treatment. The 12 compounds Sopherion is working on also include treatments for allergies, asthma and osteoporosis.
Sopherion, founded three years ago, is in the process of trading its current lab space at 300 George Street Technology Center for a larger space in the same building and will expand its 15-member staff to 40 employees, Franchetti said.
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