Venture
Update Vol. VIII, #9, October 2004
Done Deals
Durham - Cellective Therapeutics, an early-stage biotechnology company, has completed a $27.5 million Series A round to accelerate drug development of the company's lead antibodies for cancer and autoimmune diseases. Durham-based Intersouth Partners led the financing and was joined by seven other firms: Alta Partners, BA Venture Partners, Forward Ventures, Genentech, Inc., Latterell Venture Partners, MedImmune Ventures, Inc., and Sofinnova Ventures. Cellective, founded in 2003 from technology licensed from Duke University and the Dana Farber Cancer Institute, has also appointed Arthur M. Mandell as its new President and CEO. Contact Matt Jenkins (919.313.4583).
Raleigh - CipherOptics (www.cipheroptics.com) a provider of high-speed network security appliances, has closed a $10.3 million Series C round to expand sales, marketing and product development efforts. The financing, led by Adams Capital Management, was supported by existing investors, including Kodiak Venture Partners, Origin Partners L.P., and Axiom Venture Partners L.P. CipherOptics is among 27 NC-based companies selected to demo at CED's InfoTech 2004 Conference Oct. 8 in the RTP. Contact Rick Schell (919.865.7305).
Raleigh - Dogwood Equity (www.dogwoodequity.com), manager of the $74 million N.C. Economic Opportunities Fund, has provided $4 million in mezzanine financing to support Turkington Industries' acquisition of APV Baker-Goldsboro in a combination of senior debt, subordinated debt and equity. United Kingdom-based Turkington Industries will use the funds to acquire all the assets of the APV Baker-Goldsboro business from Invensys. Contact Rick Carlisle (919.256.5000).
Morrisville - Tekelec (www.tekelec.com), a maker of telecommunications switches, has acquired VocalData, a Texas-based provider of hosted Internet telephony applications, for $27.5 million in cash and stock. Terms of the deal include $14.5 million in cash and approximately 780,000 shares of Tekelec. In addition to its corporate headquarters in California, Tekelec has its sales, marketing, R&D and manufacturing operations in Morrisville, NC. Contact Joni K. Brooks (919.461.1065).
RTP - RTI International (www.rti.org) plans to acquire three research divisions of MCNC's Research and Development Institute (www.mcnc-rdi.org), including MCNC's Signal Electronics Division, Materials and Electronic Technologies Division and Advanced Network Research Division. MCNC's Grid Computing and Ventures business units are not included in the RTI acquisition. With this announcement, RTP's MCNC will introduce an annual research grant program - up to $500,000 annually - to support research likely to result in new companies. Through MCNC Ventures and the new grant program, MCNC will collaborate with other NC-based economic development partners to evaluate, select and help fund research initiatives. Contact Scott Yates (919.248.1907).
Charlotte - LendingTree, Inc. (www.lendingtree.com), an online lending and real estate exchange, has entered into an agreement to acquire HomeLoanCenter.com, an online direct mortgage lender based in California. The transaction is expected to close in several months. Contact Mindy Nuebauer (704.944.8541).
Raleigh - Red Hat, Inc. (Nasdaq: RHAT, www.redhat.com), a provider of open source solutions to the enterprise, has entered into a definitive asset purchase agreement with America Online, Inc., to acquire certain assets of Netscape Security Solutions. The acquired products are derived from the Netscape Enterprise Suite and include Netscape Directory Server and Netscape Certificate Management System. Red Hat plans to start marketing these products as part of its Open Source Architecture over the next 6 to 12 months. Contact Leigh Day (919.754.3700 x44369).
On The Up
Adigy Corporation
Research Triangle Park, NC
Medical device companies play a key role in the Research Triangle region's economic competitiveness, according to Harvard Business School Professor Robert Porter. While the region already boasts several established medical device companies like Closure Medical, the pipeline for this industry cluster is getting even stronger.
One of the region's emerging medical device companies is Adigy Corporation, founded in June 2004. Adigy is implementing unique developments in radio-frequency identification (RFID) and new biosensors technology to improve the real-time physiological monitoring of medical patients.
An estimated 98 percent of healthcare facilities monitor patients with electrocardiograms or pulse-oximetry systems that require 10-foot connection cables. Beyond this common “cabled” approach, a small fraction of hospitals use technology called medical telemetry that removes patient cables by requiring the patient to wear a costly and bulky transmitting “box” on their side.
Adigy seeks to improve these traditional patient monitoring methods with small, RFID-enabled products that would eliminate wire entanglement and allow for easier movement in the hospital room. Adigy's products boast advantages in size, power, range and cost, and would also work seamlessly with existing equipment. Although still in early stages of development, the products are backed by strong intellectual property.
Leading Adigy is an experienced management team. Adigy's CEO Rich West was formerly the CEO and founder of Durham-based TriVirix, a medical device manufacturer that West grew from start-up to over $70 million in revenue. Dr. William New, Adigy's Chairman and Chief Marketing Officer, is an inventor, physician and founder of two now-public medical device companies - Nellcor and Natus Medical. Dr. Bozena Kaminska, Adigy's Chief Technology Officer, is an industry-wide expert on RFID technology and has also founded multiple successful companies.
With Adigy's early-mover advantage and seasoned group of managers, West is optimistic about the company's short-term and long-term future.
“There is no doubt that, in the long run, monitoring will be uncabled - patients, doctors, nurses, and hospitals all want that,” West said. “Adigy's products will provide the advantages of uncabled monitoring without the cost penalty of current systems.”
The company is seeking $3-5 million to complete product developments and grow aggressively. Contact Rich West (919.402.1375).
New Developments
RTP - Adherex Technologies Inc. (www.adherex.com), a biopharmaceutical company with a portfolio of oncology products under development, has filed a registration statement with the SEC to prepare to list its common stock on a U.S.-based stock exchange. Adherex's listing would most likely be on the American Stock Exchange (“AMEX”). Contact Melissa Matson (919.484.8484).
Raleigh - N.C. State University (www.ncsu.edu) has completed the first stage of its agreement with St. Louis-based Orion Genomics to sequence large parts of the tobacco genome. With positive findings thus far in the lab, university officials have extended the agreement to double payments to Orion, under the company's subcontract for a portion of the $17.6 million provided to N.C. State University by Philip Morris USA as part of the 4 1/2-year Tobacco Genome Initiative. Contact Nathan Lakey (314.615.6977).
RTP - RTI International (www.rti.org) has received a $4.9 million grant from the EPA to develop and test a variety of data collection technologies. The four-year study will assess the accuracy and practicality of collecting exposure-related behavioral data using methods such as voice recorders, personal digital assistants, automated photo diaries, global positioning systems, RFID devices, chest-belt sensors and micro-accelerometer devices. The study will be conducted first with individual volunteers, then via a week-long pilot test of 40 local homes, and finally in field tests of more homes over the next two years. Contact Patrick Gibbons (919.541.6136).
In the Pipeline
Durham - KBI BioPharma, Inc. (www.kbibiopharma.com), a contract biopharmaceutical process development, production and technology company, has advanced its proprietary Centrifugal Bioreactor (CBR) technology from a research environment into an applied development phase. KBI has conducted proof-of-principle work that shows its CBR technology maintaining high-density fluidized cell cultures over long periods. Contact Dr. Roger Lias (919.479.9898 x2003).
Pittsboro - Biolex (www.biolex.com) has opened its new clinical biomanufacturing facility with enough capacity to produce one million doses per year of its lead product alpha interferon, a recombinant human protein used to treat infectious diseases such as Hepatitis C. Biolex has initiated cGMP production of alpha interferon (production conforming to U.S. and international regulatory guidelines on current Good Manufacturing Practices) and expects to file an IND with the FDA during 2004. Contact John Irick (919.542.9901).
High Point - TransTech Pharma, Inc. (www.ttpharma.com) has inked a $26 million research collaboration with Merck. The companies will use TransTech's proprietary TTP Translational Technology to discover and develop novel small molecules for a therapeutic target of interest to Merck. Merck also has the exclusive right to develop and commercialize all compounds directed at the target covered by the collaboration. Contact Dr. Adnan Mjalli (336.841.0300 x101).
RTP - AlphaVax (www.alphavax.com) has received a three-year, $4.8 million vaccine development grant from the National Institute of Allergy and Infectious Disease (NIAID) of the National Institutes of Health (NIH). The award covers early development of a vaccine against severe acute respiratory syndrome (SARS). Contact Peter Young (919.595.0400).
RTP - Qualyst, Inc. (www.qualyst.com) has received two additional international patents from Australia and New Zealand for the company's absorption, distribution, metabolism, excretion and toxicity (ADMET) products. Qualyst's product lines are now covered by five issued patents and 24 pending patent applications worldwide. Qualyst is a spin-out from the University of North Carolina at Chapel Hill. Contact Ian Mehr (919.313.6507).
RTP - Norak Biosciences, Inc. (www.norakbio.com) announced that Roche has exercised its second year option to screen more of its G protein-coupled receptor (GPCR) targets of interest using Norak's Transfluor technology. The option was part of the agreement inked in September 2002 between the two companies. Norak will provide its Transfluor cell lines expressing GPCR targets of interest to Roche for use in a primary screen of its compound libraries. Contact Terry Willard (919.248.8000 x8804).
RTP - Aeolus Pharmaceuticals, Inc. (OTC Bulletin Board: AOLS, www.aeoluspharma.com), announced that the FDA has accepted Aeolus' IND to begin Phase 1 clinical trials of AEOL 10150 for the possible treatment of patients with amyotrophic lateral sclerosis (ALS), or Lou Gehrig's disease. The Phase 1 clinical studies will test the range of doses over which AEOL 10150 is safe in patients diagnosed with Lou Gehrig's disease. Contact James D. Crapo 919.558.1907.
Miami, FL - Thirty-two life science companies from across the Southeast will present at the sixth annual Southeastern BIO Investors Forum (www.sebio.org) on Nov. 8 and 9 in Miami, Florida. Nine of the 32 selected companies at SEBIO 2004 are Research Triangle-based life sciences companies. Cropsolution, Hemocellular Therapeutics, Inc., Metabolon, Nuada Pharmaceuticals, Inc., Regado Biosciences, Serenex, Inc., and StemCo Biomedical, Inc. are among the main-stage presenters. Early-stage presenters include HyperBranch Medical Technology, Inc., and NephroGenex. Contact Linda Hoover (910.452.0006).
Mark Your Calendar!
CED's InfoTech 2004 Conference
October 8, 2004
Sheraton Imperial Hotel & Convention Center
RTP, NC
www.cednc.org/infotech
6th Annual Southeastern BIO Investor Forum
November 8-9
Doral Golf Resort & Spa
Miami, FL
www.sebio.org
For more information, visit the CED Web site (www.cednc.org) or call 919-549-7500.
Venture Update is published by the
Council for Entrepreneurial Development (CED)
an entrepreneurial support organization located in the Research Triangle Park, N.C.
Lisa Rowe-Ralls, editor
P.O. Box 13353, RTP, NC 27709
Phone: 919-549-7500
FAX: 919-549-7405
email: news@cednc.org