EP Vantage Interview - BerGenBio close to securing Series A funds

BerGenBio is moving up. The private Norwegian group says it is about to close on a series A financing round by the end of the year that should help take its lead product through human proof-of-concept trials, becoming one of the lucky few who have secured early venture funding this year (see table below).

The company hopes BGB324 will show effectiveness in suppressing a cellular process that allows cancerous cells to migrate from tumours and metastasise, as well as develop resistance to chemotherapy. In an interview with EP Vantage, chief executive Richard Godfrey says acute myeloid leukaemia “looks interesting” as a target condition, but more will be known by the end of 2012 when BerGenGio files its investigational new drug application with the FDA.

Survival

BGB324 is an inhibitor of AXL tyrosine kinase, a protein that has been associated with endothelial-mesenchymal transition (EMT). The transition is a process useful in cell differentiation in embryos; essentially, cells lose gene expression patterns and behaviours characteristic of epithelial cells and gain those of less-differentiated mesenchymal cells. This means they lose cell adhesion and are able to migrate to other parts of the body; when activated in tumours EMT enables metastasis.

“It’s a survival mechanism,” Mr Godfrey says.

BerGenBio licensed the compound in July from Rigel Pharmaceuticals, which had ceased work on the product it called R428. Pre-clinical studies have shown evidence of activity in acute myeloid leukaemia; thus the desire to file an IND by the end of 2012 and begin testing the drug in humans in early 2013.

The series A about to be announced will be sufficient to fund the company through phase IIa by 2014, Mr Godfrey says. If venture capital fundraisings this year are any indication, it may be a modest amount (Vantage Point – VC funding slump in first half points to tougher times ahead, August 17, 2011).

Even more so when considering the performance of Scandinavian fundraising - so far in 2011, $173m has been raised from seven Scandinavian venture financing rounds. Yet if Symphogen’s huge $143m series F is excluded, the amount drops to just $30m, or $5m per fundraising across all stages (EP Vantage Interview - Symphogen awaits proof of concept as funding secured, January 26, 2011).

Just like the region's public drug developers, Scandinavian private companies are being particularly hard hit in a painful year for the European biotechnology sector (Scandinavian biotech hit particularly hard in bad year for sector, December 2, 2011).

Scandinavian venture fund rounds European venture fund rounds
Date Investment ($m) Financing Count Investment ($m) Financing Count
 2011  173  7  770  42
 2010  64  16  1,031  80
 2009  112  15  923  78
 2008  107  15  995  76
 2007  223  23  1,614  98
 2006  205  14  1,058  66
 2005  184  13  937  64
 Total  1,069  103  7,328  504

Should BerGenBio succeed in proving the efficacy of inhibiting AXL kinase, it may be the last time company executives look to investors to fund clinical work on the agent, as a partner will be sought.

“We don’t intend to go into large scale phase II/III studies,” Mr Godfrey says.

Validation

BerGenBio was started as a spinout from the University of Bergen, with a technology platform that aims to quickly identify drug targets and off-target effects of medications. Among its strengths is a sensitivity to dose response, Mr Godfrey says. Its strengths were validated when it assisted Proteolix in the development of carfilzomib, prompting the company to investigate drug development and the AXL kinase inhibitor target (Onyx making nice progress but takeover rumours seem wide of the mark, November 30, 2011).

Supported so far with Norwegian seed funding, BerGenBio’s A round will be supported by Norwegian VC funds, he says. A careful line has to be trod, however, in plotting a business strategy with its backers, according to Mr Godfrey; with the new cash, no rapid expansion or external addition to the pipeline appears to be on the cards.

“We didn’t want to be part of one of these buy and build funding rounds. We didn’t want to take our technology and feather it into a company shell,” said Mr Godfrey. “Our lead programme is very interesting and very exciting. It’s the result of five years of work. We still have a few years of work ahead of us.”

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