Ligand CEO Outlines Strategy, Arena Rebalances its Debt, Venture Biotech Versus Pharma Debate Flares Anew, & More San Diego Life Sciences News

3/31/11Follow @bvbigelow

A debate over the sustainability of the venture biotech ecosystem continues to percolate, and the San Diego Venture Group is even planning a breakfast debate on the topic. We’ve got the rest of what’s brewin’ in life sciences too.

—San Diego’s Ligand Pharmaceuticals (NASDAQ: LGND) is pursuing a fundamentally different strategy under CEO John Higgins. Instead of trying to develop billion-dollar drugs internally, Higgins said he has acquired 60 new drug candidates through acquisitions over the past three years. He intends to generate more chances to develop successful drugs by keeping Ligand’s costs low and forging partnerships with pharmaceutical companies as soon as possible.

—Antoine Papiernik of Sofinnova Partners in Paris responded to criticism that Avalon Ventures founder Kevin Kinsella leveled against the pharmaceutical industry a few weeks ago. Papiernik says the issues that Kinsella identified as “predatory business practices” are a predictable result due to the weakness of venture-backed life science companies—and the weakness of their VC backers.

—Luke argued in his BioBeat column that Big Pharma isn’t realizing many advantages through its spate of recent consolidations. He said mega-mergers create a lot of internal bureaucratic headaches, and that companies spend months, sometimes years, trying to figure out exactly what they acquired through a merger.

Vertex Pharmaceuticals (NASDAQ: VRTX) reported that its cystic fibrosis drug, VX-770, is working about as well in children as it did in previous trials with older patients who have the genetic disorder. The Cambridge, MA-based company, which has operations in San Diego, said the drug is intended to improve the function of a defective protein with a specific mutation called G551D.

—San Diego’s Regulus Therapeutics said it got exclusive rights from New York University to develop treatments for a couple of microRNA targets that are believed to be involved in atherosclerosis and metabolic syndrome. Financial terms of the license weren’t disclosed.

—San Diego’s Carefusion (NYSE: CFN) sold its Onsite Services business to affiliates of Seattle-based Frazier Healthcare Ventures without disclosing terms of the deal. OnSite offers medical instrument repair and instrument management programs to hospitals.

—San Diego-based Arena Pharmaceuticals (NASDAQ: ARNA) raised $35.5 million through a PIPE stock offering, a private investment in a public entity. Arena plans to use about half of the proceeds to pay off debt to Deerfield Management that comes due in June 2013. Deerfield, a New York hedge fund manager, also was the investor in the PIPE. It is buying 12.15 million common shares of Arena stock for $1.46 each and 12,150 shares of preferred shares for $1,460 each.

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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