Specialty Pharma Firm ArgiNOx Gets $8M Series B Round


ArgiNOx Pharmaceuticals, a specialty pharmaceuticals firm focused on cardiology, oncology and autoimmune disease, has raised $8 million in Series B financing.

The Series B round was co-led by new investor Perseus-Soros Biopharmaceutical Fund, and ArgiNOx's founding investor, Topspin Partners. The financing also had participation from a group of individual investors, including new and existing shareholders.

Founding Chief Executive Ken Drazan said the new investment was provided in full on June 11, after a fundraising process that began in January. The firm previously raised $8.3 million from Topspin in a Series A round that was provided in two tranches, one that closed July 2002 and another in May 2003.

While he declined to disclose a specific valuation for the new investment, Drazan described the pricing as "a significant step up" from the previous round. ArgiNOx now has roughly $9 million in cash, which should carry the company's clinical operations for 18 months, Drazan said.

ArgiNOx's lead drug candidate is an injectible tilarginine acetate, an endogenous small molecule inhibitor of nitric oxide, or NO.

NO is a mediator of health and disease with novel signaling pathways that are operative in each of ArgiNOx's targeted programs.

The start-up's first clinical campaign is a multi-national Phase IIb study to assess the safety and biological efficacy of tilarginine acetate in cardiogenic shock, or CS.

CS is a highly lethal complication of acute myocardial infarction stemming from ventricular failure, vascular paralysis and end organ damage; according to the company's estimates, the condition affects between 70,000 and 100,000 adults in the U.S. annually. American Heart Association guidelines for the treatment of CS are primary angioplasty, vasopressor/intrope support and intra-aortic balloon pump therapy. However, despite aggressive medical management through the use of these treatments, there remains a 30-day mortality rate of between 40% and 70% associated with the condition.

ArgiNOx's tilarginine acetate therapy is designed to address excess NO production implicated in the disease pathogenesis.

In the drug's pilot human studies, patients using the therapy demonstrated a reduction or nearly 50% in mortality rate, the firm said. These trials were conducted in 2000 and 2001 by Gad Cotter, then a researcher in the Clinical Pharmacology Research Unit of The Cardiology Institute, at Israel's Assaf-Harofeh Medical Center. Cotter is now an associate professor at Duke University.

ArgiNOx acquired rights to the therapy in May 2003 - coincident with the second tranche of its Series A financing, Drazan said. This January, ArgiNOx initiated its current Phase IIb study of the drug in the U.S., Canada, France, Austria, Germany, Denmark, Belgium and Israel. Complete enrollment is expected by fall of 2004. Judith Hochman, Chief of Clinical Cardiology at NYU School of Medicine, is serving as study chair for the trial.

ArgiNOx has received one SBIR Grant to support its CS study and two additional SBIR grants for preclinical drug discovery operations in agonists of hematopoiesis and vascular function. ArgiNOx is conducting the preclinical programs with Grigori Enikolopov, an associate professor of molecular biology at Cold Spring Harbor Laboratory and Steven Gross, a professor of pharmacology at Weill Medical College of Cornell University.

As a result of the new funding, Drew Schiff of PSBF has been appointed to ArgiNOx board, and Magdalene Cook, also of PSBF, has joined as a board observer. Leo Guthart of Topspin Partners also serves as a director on the company's five-seat board.


Topspin Partners, LP

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