San Diego Life Sciences Roundup: Vical, Sequenom, Sophiris, and More
There was a lot of news for this cowboy to round up in San Diego’s life sciences sector this week. Applied Proteomics and Acutus Medical each raised $28 million from venture investors, while Vical and Sequenom disclosed substantial staff cuts. Here’s my rundown of the good, bad, and ugly.
—San Diego’s Vical (NASDAQ: VICL) said it would lay off 47 employees, or roughly 39 percent of its workforce, as part of a restructuring following the recent failure of its lead drug candidate in a late-stage trial of patients with melanoma, the deadliest type of skin cancer. Vical CEO Vijay Samant said the restructuring is needed to conserve the company’s available cash, which was $70 million at the end of June. Vical will have about 74 employees following the restructuring, which is intended to focus on infectious disease vaccine programs.
—San Diego’s Applied Proteomics raised $28 million in a Series C round of financing to advance diagnostics technology—an ambitious idea that combines the capabilities of advanced mass spectrometry with big data. The company, founded by USC cancer specialist David Agus and computing visionary Danny Hillis, said it will use the capital to commercialize its system for accurately measuring all the protein fragments in a drop of blood. The Malaysian conglomerate Genting Berhad led the latest round, and was joined by existing investors Domain Associates and Vulcan Capital, the investment vehicle of billionaire Paul Allen.
—San Diego’s Acutus Medical said it closed its Series B round at $28 million, adding another $7 million since June 25th, when Acutus said it had raised $21 million from a new investor, OrbiMed Advisors and existing investors Index Ventures and Advent Ventures. The announcement adds GE Ventures as another lead investor in the round. The medical device company is developing a minimally invasive cardiac catheter for treating cardiac arrhythmias.
—Shares of San Diego’s Sophiris Bio (NASDAQ: SPHS) have regained some yardage lost last Friday, when the company made its IPO debut on the Nasdaq market (in a switch from the Toronto Stock Exchange). The biotech, which is developing a drug intended to treat benign prostate enlargement, had intended to sell 5 million shares of its stock at $13 per share. But the company was forced to flip the terms of its IPO to instead offer 13 million shares at $5 a share—and lost over 10 percent in first-day trading. Why was there resistance? In a phone call earlier this week, John McCamant of the Berkeley, CA-based Medical Technology Stock Letter attributed the biotech’s difficulties to indifference on Wall Street. “They’re all in the Hamptons,” McCamant told me. Sophiris closed yesterday at $4.77 a share.
—San Diego-based Fate Therapeutics, which is developing therapies based on adult stem cell modulators, registered to become a public company through an IPO. In a regulatory filing, the company outlined its plans to raise as much as $69 million, although Fate said the number of shares to be offered and the price range for the offering have not been determined.
—In his BioBeat column, Luke updated his list of the life sciences Twitterati—the people who contribute in a meaningful way to the Twitter stream of consciousness that he follows for news, gossip, and insights in healthcare, biotechnology, medical devices, and related fields.
— San Diego-based Sequenom (NASDAQ: SQNM), which specializes in molecular diagnostics and genetic analysis, said it would lay off 75 employees, or nearly 13 percent of its workforce, as part of a cost-cutting plan. The layoffs are part of a cost-cutting reorganization the company is undertaking after incurring bigger-than-expected losses because of a delay in the collection of diagnostic segment revenues.
—San Diego-based Afraxis and Sunovion Pharmaceuticals signed an agreement that will enable the Marlborough, MA-based pharma to use Afraxis technology to assess the effectiveness of potential drug compounds in treating disorders of the central nervous system (CNS). The new Afraxis technology advances neuroscientists’ ability to rapidly analyze how drugs affect dendritic spines—the pinhead-like protrusions along the neuron’s cell body.
—San Diego’s DermTech said it has raised $5.6 million in Series B founding to develop a non-invasive diagnostic test for melanoma, the deadliest form of skin cancer. Jacobs Investment, the Del Mar, CA-based investment arm of Qualcomm scion Gary Jacobs, led the new round of financing, which was joined by unnamed new and existing investors.
—Johnson & Johnson (NYSE: JNJ) completed its billion-dollar buyout of Aragon Pharmaceuticals, the San Diego cancer drug developer. Meghana Keshavan of the San Diego Business Journal reported that former Aragon CEO Richard Heyman and other Aragon executives and staff have formed a new San Diego company, Seragon Pharmaceuticals, that intends to use some Aragon technology to develop a breast cancer treatment. J&J paid $650 upfront to acquire Aragon, with an additional $350 million in milestone payments.
—Epic Sciences, the San Diego biotech startup developing advanced cancer diagnostics technology, named Murali Prahalad as president and CEO. Prahalad was previously the vice president of corporate strategy at Carlsbad, CA-based Life Technologies. Epic is developing technology to detect and identify cancer cells that may be circulating in a blood sample.
—San Diego-based Acadia Pharmaceuticals (NASDAQ: ACAD) named Terrence Moore as Executive Vice President and Chief Commercial Officer. Moore, who reports to Acadia CEO Uli Hacksell, is responsible for leading Acadia’s commercial activities. The company is developing new treatments for disorders of the central nervous system.