Genzyme-Spinout Peptimmune Files for Chapter 7 Liquidation

3/23/11

Peptimmune, a Somerville, MA, biotech firm that has been developing a long-lasting drug for multiple sclerosis, filed for Chapter 7 liquidation on Monday, according to a court filing. VentureWire reported the news this morning.

The biotech—which was acquired by Genzyme (NASDAQ:GENZ) in 1999 and then spun off from the Cambridge, MA-based drugmaker as an independent firm in 2002—has about $2 million in assets and liabilities of about $2.2 million, according to the court filing. Its largest debt appears to be owed to Waltham, MA-based biotech company Alkermes (NASDAQ:ALKS), which is due $730,249 related to a lease agreement termination.

Peptimmune, which raised about $100 million in equity and debt, is seeking a sale of its assets after struggling to raise $35 million to advance its lead drug PI-2301 into a mid-stage clinical trial for treating multiple sclerosis, CEO Thomas Mathers told Venture Wire. The experimental drug is a peptide copolymer that has similar properties to the approved MS drug glatiramer acetate (Copaxone), yet a potential advantage of Peptimmune’s drug is that it is injected once per week and the similar medication is injected daily.

In October, Peptimmune filed a petition with the FDA to request that the agency not approve a generic version of Teva Pharmaceutical’s glatiramer acetate for multiple sclerosis.

Peptimmune licensed some of its core technology from MIT, which the biotech owes $22,118 related to a technology licensing agreement, according to the Chapter 7 filing.

After the company’s spinoff from Genzyme, it attracted investments from MPM Capital, an MPM-managed Novartis fund, and New Enterprise Associates, among other firms. According to court documents, those three funds hold a 78 percent stake in the company. Other investors included Genzyme, Silicon Valley Bank Capital, Hunt BioVentures, SVB Capital, and Boston Medical Investors.

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