Celladon, Developer of Gene Therapy for Heart Failure, Secures Part of $24.6M Venture Round

9/15/09Follow @xconomy

Investors haven’t completely turned their backs on gene therapy, at least not on Celladon. The San Diego-based company raised another $2.8 million in recent weeks to keep operating until it sees results from a clinical trial that will show whether it has a groundbreaking gene therapy for people with congestive heart failure.

The latest financing means Celladon has raised a total of $21.8 million in three installments, out of a total Series C financing round worth as much as $24.6 million, says Rebecque Laba, the company’s vice president of finance and administration. The company has secured a total of $61 million since it first raised money in 2004, Laba says. Investors include Enterprise Partners Venture Capital, Venrock Associates, and Johnson & Johnson Development Corporation.

More than a hundred companies have been formed since the early days of gene therapy in the 1990s, when many researchers saw gene therapy as an ultimate-cure all for diseases that resisted conventional drug treatment. Gene therapy is about modifying viruses to carry copies of genes into cells where they can replace missing or faulty genes at the root cause of certain diseases. The field was plagued by safety concerns in the late 1990s, and no such treatment has yet won FDA approval.

But Celladon likes its chances for a few reasons: It is using adeno-associated virus technology from Seattle-based Targeted Genetics (NASDAQ: TGEN) that is designed to efficiently deliver genes into cells, without causing illness like other viruses. While there’s always risk with any new type of treatment, Celladon hopes to offset that risk with benefits for treating congestive heart failure, an illness that kills 300,000 people a year, who have few treatment options other than beta-blockers and diuretics. And Celladon’s therapy can be delivered via a direct injection into the heart, and doesn’t need to circulate effectively through the body—a challenge that has tripped up other gene therapies of the past.

“We feel like this is the sweet spot for gene therapy,” Laba says.

The Celladon treatment, called Mydicar, is designed to transfer a gene called SERCA2a into heart muscle cells, where it produces an enzyme that improves the heart’s ability to pump blood.

The treatment is being tested in a mid-stage clinical trial of 49 patients, Laba says. The trial will look first at whether the treatment is safe, but also will measure important signs of effectiveness like how far patients can walk in six minutes, how the heart looks under diagnostic images, and quality of life scores. Results from the study, called Cupid, are expected by February or March, Laba says.

Celladon operates on the “virtual” company model that’s become popular in recent years, as Denise described last week. Celladon has five regular employees, and 8-10 workers when factoring in regular contractors, Laba says. If the trial is successful, it will look to partners for help with the next phase of Mydicar development, she says.

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