Getting Late Stage Products Early
Thanks to its speedy deal with Zentaris (a subsidiary of Degussa), two-year old discovery-based start up Ardana Bioscience has leaped into the clinic with a phase II product. Now it's planning more late-stage deals, hoping that investors who typically ignore early-stage companies will finance a commercially focused organization with a track record of in-licensing the right drugs.
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Cyclacel does not have a late-stage or marketed product. But a singular focus on the biology of the cell cycle, a strong early-stage pipeline and a set of broadly applicable biomarker technologies that may minimize development risk has kept investors interested. Cyclacel has been able to complement its internal pipeline with two recent in-licensing deals, and as capital cautiously returns to European biotech, the company expects to leverage its approach to build value not only in cancer but in other proliferative diseases as well.
MediGene's recent licensing deal with Yamanouchi buys the German biotech time, but does little to strengthen its long-term finances. For this, MediGene will likely have to brave the cold waters of the German capital markets. It will be the first biotech to do so since Germany's growth market collapsed in 2001.
The $752 million worth of new funds raised by leading European biotechnology VCs over the past three months suggests that Europe's private biotech market is picking up. But these funds won't simply land in companies' laps. Europe's biotech managers, many of whom have raised funds only during boom times, will have to satisfy increasingly stringent criteria to secure their slice of the pie. Yet although late-stage products and critical mass still top some investors' wish lists, selected platform and early-stage groups capable of rapidly advancing a broad range of compounds into the clinic have also found funding.