Kleiner Perkins to back early-stage biotechs with $525M fund

Posted under Auxogyn, Beth Seidenberg, Biotech Venture Capital, Blog, Celladon, Companies, Diagnostics, Epizyme, Foundation Medicine, Funding, iPierian, Kleiner Perkins Caufield & Byers, Medical Devices, Medical Supply, Pharmaceuticals, Pipeline, Startups, Tesaro, Universities, Videos by John Carroll

Beth Seidenberg, Investment Partner--Source: KPCB

Kleiner Perkins Caulfield & Byers has closed the books on a new $525 million fund. And a chunk of that treasure is earmarked for early-stage life science companies promising to satisfy Kleiner Perkins' trademark appetite for disruptive new technologies.

"Portfolio companies in KPCB 15 will benefit from the firm's holistic approach to company building that we pioneered more than a decade ago," said Ted Schlein, partner at KPCB, in a statement. "We will identify promising early-stage companies in our areas of focus and bring value-added resources in key areas to help early-stage companies grow and succeed. This includes applying our considerable industry, operational and financial expertise and network of relationships to help entrepreneurs build lasting enterprises."

Among the group of partners with a key to the cash box is Beth Seidenberg, the former chief medical officer at Amgen ($AMGN) who has been handling the fund's investments in Tesaro, Epizyme, iPierian and Auxogyn, among others. KPCB has also invested in Foundation Medicine and Celladon. 

Seidenberg's interest in biotech goes well beyond the boardroom. She's been one of the leading forces at the Medical Innovation and Competitiveness Coalition, which joined up with the National Venture Capital Association to apply pressure on the FDA to change. The lobbying effort has helped inspire new legislation aimed at speeding drug approvals while putting the FDA on the defensive about its regulatory track record.

"The major problem is the lack of predictability, which leads to delayed timelines," Seidenberg told The Wall Street Journal last fall. "Entrepreneurs are smart people, and they want to get their products to patients. And because of the lack of transparency, and the lack of consistency (at FDA), they are moving to Europe, setting up their organizations and creating jobs overseas." 

- here's the press release

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UPDATED: Upstart Ra sheds stealth status, targets new drug class

Posted under angioedema, Biotech Venture Capital, Blog, Clycomimetics, Companies, Diagnostics, Doug Treco, Funding, Medical Devices, Medical Supply, Morganthaler Ventures, New Enterprise Associates, Pharmaceuticals, Pipeline, Ra Pharmaceuticals, rare diseases, Startups, Universities, Videos by john

Cambridge, MA-based Ra Pharmaceuticals is stealth no more. Two years after it snagged an initial $10 million in venture cash, Ra has hauled in a second tranche of $8.6 million and picked its disease target: hereditary angioedema, a rare and lethal immune system disorder. And after maintaining strict silence as the biotech was being incubated at Morgenthaler Ventures, biotech vet Doug Treco today is going public, asserting that Ra is on the trail of a new drug class.

Ra's claim to fame will rest on Cyclomimetics, which Treco says will have the "diversity and specificity of antibodies, coupled with the beneficial properties of small molecules."

"The only FDA-approved treatment for the prevention of HAE attacks is delivered intravenously every 3 to 4 days and produced from human blood," Treco said in a statement. "Our synthetic Cyclomimetics are easily produced, and could offer a stable, highly potent option for patients suffering from HAE. In addition, Cyclomimetics have the potential to be orally-available, which would significantly increase the quality of life for patients with HAE." 

The inspiration for the biotech dates back 7 to 8 years, says Treco, when he was working in the lab of Nobel prize-winning scientist Jack Szostak, who's now chairman of Ra's scientific advisory group.

"We want to claim the middle ground between small molecules and proteins," Treco tells FierceBiotech this morning. "Proteins and monoclonals are outstanding drugs," he adds, characterized by low toxicity and capable of carrying out multiple functions. "But they can't get into cells, are expensive to manufacture and require injection." Small molecules, meanwhile, have great availability but lack specificity and often trigger off-target toxicity.

A new drug class involving a slightly larger molecule, though, could disrupt protein-protein interaction, offer great specificity and low toxicity. And Ra plans to create new peptides that can make it into cell membranes.

Treco says the biotech is on track to get into the clinic in about two years. And he's upbeat about the prospects of building "massive libraries" that can be used to develop a significant pipeline of therapies; some that it can keep, others that can be partnered. And he also expects to partner with drug developers who will come to Ra looking to solve some thorny problems. Ra has gathered together a staff of 19 and plans about seven more hires by the end of the year.

Treco is a familiar face in the rare disease space. He co-founded Transkaryotic, which Shire bought out in 2005 for $1.6 billion. Ra was initially incorporated in 2008 and gained a $27 million Series A commitment from New Enterprise Associates with Morgenthaler Ventures, Novartis Venture Funds and Amgen Ventures.

- here's the press release

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Early VC rounds nosedive for biotech startups in Q1

Posted under Atlas Venture, Biotech Venture Capital, Blog, Companies, Diagnostics, Funding, Medical Devices, Medical Supply, Pharmaceuticals, Pipeline, PricewaterhouseCoopers, Startups, Universities, VC, Videos by rmcbride

Life sciences venture investors gambled far less on life sciences startups in the first three months of the year, underscoring a shift toward later-stage deals and concerns about the amount of dollars going into newly hatched drug and device developers.

After reporting last month that first-quarter venture investing in U.S. biotech dropped by 43%, PricewaterhouseCoopers has drilled deeper into the numbers and noted that young life sciences outfits might have fared even worse than more mature startups. Based on data from Thomson Reuters, the firm found that the number of companies to get their first influx of VC money fell by 53%, and dollars invested into deals shrank by 38% in the first quarter compared with the same period last year.

The game of taking the pulse of innovative activity in biotech based on venture numbers can be tricky, as young drug developers have learned to make do with smaller budgets and some outfits choose to stay under the radar and advance programs without a big-bang VC round. There's also plenty of talk about the dearth of big-idea operations getting off the ground nowadays because of the huge expense and risk of supporting such companies. 

"I don't get concerned about quarterly variation in dollars and deals," Atlas Venture partner Bruce Booth, who invests in biotech, said in an email. "Overall Life Sciences investments were within 10% of 1Q 2011, and 2011 was one of the strongest four years for [life sciences] venture investing in the past 15 years."

The VC industry as a whole has contracted, yet Booth's analysis shows that the relative interest in backing biotech and device companies hasn't changed. "[Life sciences] remains reasonably steady as a percentage of total venture capital spend: it has been around 25% for most of the last decade and I expect that to continue."

- here's PricewaterhouseCoopers' release

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The best of times, the worst of times?

Biotech venture rounds dwindle in Europe, tracking U.S. trend

Posted under Biotech Venture Capital, Blog, Companies, Diagnostics, Europe, Funding, Medical Devices, Medical Supply, Pharmaceuticals, Sir Christopher Evans, Startups, Universities, Videos, Wellcome Trust by john

Fresh on the heels of the news of a disappointing quarter for biotech investing in the U.S., Dow Jones VentureSource has done the math for Europe and come up with an equally dispiriting set of stats. 

Biopharma was the dominant category in the continent's healthcare industry, accounting for 26 deals that raised 108 million euros--out of 137 million euros for all of healthcare--compared to the same period a year ago. That represents a 16% drop in deals and a whopping 66% plunge in cash.

On the bright side, though, Europe saw a number of new funds come together in recent months. The Wellcome Trust has created a substantial new fund while Sir Chris Evans has been working at gaining government cash to back new ventures in Wales. Index Ventures, meanwhile, has joined with GlaxoSmithKline ($GSK) and J&J ($JNJ) on a new fund for startups, primarily in Europe. And the British government has assembled its own biopharma fund. That trend played out across all sectors for the European venture community.

"The difficult fund-raising environment and shrinking number of exits means less money is flowing into venture firms and, therefore, less is flowing out," said Jessica Canning, global research director, Dow Jones VentureSource. "But there are some positive signs. European venture fund-raising rose 8% in the first quarter and financing deals didn't drop as significantly as investment which means VCs are still finding companies they want to support."

Last week Thomson Reuters reported that venture investing in U.S. biotech companies plunged 43% in the first quarter of the year compared with the strong numbers posted for the last three months of 2011. Analysts at the National Venture Capital Association and PricewaterhouseCoopers tracked 99 deals that attracted $780 million in investments.

- here's the press release

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