Cambridge, MA-based Radius Health, which is on a quest to enter the multibillion-dollar market for osteoporosis treatments, said today it has filed to go public. The company hopes to raise $86 million in the proposed offering. The IPO will be underwritten by UBS Investment Bank and Leerink Swann, and co-managed by Cowen and Company and Rodman & Renshaw.

Radius’s lead compound, BA058, is a new type of “anabolic,” or bone-building, drug. In early trials, patients have re-grown bone with little risk of developing hypercalcemia, a dangerous overload of calcium that can result from current treatments. If the drug proves effective in pivotal trials, which the company is running now, it could become a major contender in a very large market. A recent study by Global Industry Analysts of San Jose estimated that the annual market for osteoporosis treatments will reach $8.8 billion by 2015.

The current iteration of Radius’s drug is an injection, but the company is working on a more convenient dosing option—a patch it’s developing in a collaboration with 3M (NYSE: MMM). Using 3M’s “microneedle” technology, Radius developed a patch containing 360 tiny needles that deliver a full dose in about 15 minutes.

Radius last made news in May, when it raised a staggering $91 million and merged with an unlisted shell company in preparation for an IPO. The company’s investors include MPM Capital, BB Biotech Ventures, MPM Bio IV NVS Strategic Fund, the Wellcome Trust, HealthCare Ventures, Scottish Widows Investment Partnership, BB Biotech, Brookside Capital, Saints Capital, Nordic Bioscience, and Ipsen Pharma.

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Seattle-based Allozyne has made a small set of job cuts after it was unable to pull the trigger on its plan to go public late last year, Xconomy has learned.

Allozyne has let go some of its scientific staff, according to a source close to the situation. When asked how many jobs were eliminated, and how many employees remain at Allozyne, CEO Meenu Chhabra said there was no downsizing but that “we redistributed functional areas.” That decision came days after Allozyne scrapped a plan to go public through a merger with San Francisco-based Poniard Pharmaceuticals. If the deal had gone through, privately held Allozyne would have gotten a NASDAQ listing that would have enabled it to raise more money from mutual funds, institutions, and hedge funds that only invest in public companies.

“We are gearing up for Phase 3 work and are redistributing the talent to focus on clinical development and regulatory tasks,” Chhabra said via e-mail. “That said, discovery and early stage activities are alive and well.”

She didn’t say exactly how many employees remain at Allozyne, but before Christmas, Chhabra said the company had about 20 employees.

Allozyne has spent about $50 million since its founding in 2005 and was down to its last $1.3 million in cash at the end of June, according to recent regulatory filings. But when Allozyne walked away from the Poniard merger, it raised a still-undisclosed amount of cash from Arch Venture Partners, MPM Capital, and OVP Venture Partners, Chhabra said in a Dec. 22 interview. The money will be used to help the company push ahead with a plan for 2012 to move its lead multiple sclerosis drug into the third and final phase of clinical trials normally required for FDA approval, Chhabra has said.

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Seattle-based Allozyne wasn’t able to go public this year, so it has fallen back on Plan B, tapping its existing venture capital backers one more time in a bid to create more value around its lead multiple sclerosis drug candidate.

Allozyne, which has spent about $50 million since its founding in 2005 and was down to its last $1.3 million in cash at the end of June, has raised an undisclosed amount of new venture capital from its existing investors, according to CEO Meenu Chhabra. The money from Arch Venture Partners, MPM Capital, and OVP Venture Partners will be used to help the company push ahead with a plan for 2012 to move its lead multiple sclerosis drug into the third and final phase of clinical trials normally required for FDA approval, Chhabra says.

“The syndicate is extremely excited that we are on a Phase III trajectory in 2012,” Chhabra says.

Allozyne remains a private, independent company after it pulled the plug on a six-month effort to merge with San Francisco-based Poniard Pharmaceuticals (NASDAQ: PARD), which was supposed to turn Allozyne into a public company. Selling the proposal to shareholders took longer than expected, and the deal ultimately fizzled because Poniard had fallen out of compliance with NASDAQ listing requirements that say a company must have a minimum market capitalization of $15 million. That was the whole point of the transaction—getting a NASDAQ listing in order to tap large funds that invest in public companies—so it no longer made sense to go through with the deal, Chhabra says.

Moving on, Allozyne turned to additional private financing, and continues to talk with partners and mull other options, like another reverse merger or a conventional initial public offering of shares, Chhabra says. The company has about 20 employees, and hasn’t made any staff cutbacks, she says.

Allozyne’s next strategic move depends heavily on an aggressive clinical development plan for its lead asset, AZ01. Allozyne is looking to leapfrog from Phase I trials all the way to Phase III—skipping the usual intermediate step, Chhabra says. The company believes that is possible because it isn’t blazing a completely new trail with a new molecular entity, but rather is taking an existing drug the FDA knows well—interferon-beta—and packaging it in a new way so it can be injected less frequently than the existing products on the market. Weston, MA-based Biogen Idec (NASDAQ: BIIB) has established this quicker-than-usual regulatory pathway with its own version of a long-lasting version of interferon-beta.

The Allozyne proposal, which it plans to make to the FDA at a meeting in early 2012, will be to enroll 700 patients who will be … Next Page »

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Seattle-based Allozyne spent the last six months trying to go public by merging into the shell of what used to be an active, publicly traded biotech company.

But in the end, the deal fell apart.

Allozyne and San Francisco-based Poniard Pharmaceuticals (NASDAQ: PARD) said today in a statement they have “mutually agreed to terminate” the merger deal they reached in June, after realizing that shares of the combined company wouldn’t meet standards for listing on the NASDAQ exchange. Poniard said in a statement that its board is now “actively exploring alternatives” for what to do with its remaining assets.

Allozyne, the privately held developer of a long-lasting protein drug for multiple sclerosis, said in June it hoped to find its way to the public markets through acquiring Poniard, a cancer drug developer that crashed and burned two years ago, but still had an active NASDAQ listing. A couple of proxy advisory services recommended the deal, but shareholders were so apathetic about merging the companies that it took months of management hounding before enough votes were turned in to approve it. Poniard shareholders eventually agreed to the merger in November, along with a painful reverse stock split in which investors agreed to trade in 40 of their shares for just one in return, in order to prop up the stock price above $1.

But by late in the year, the Poniard shareholder base still hadn’t gotten excited about the newly merged company. After news of the termination, shares of Poniard fell 5 percent to $2.79 at 10:28 am Eastern time.

Allozyne CEO Meenu Chhabra, who would have been the CEO of the combined company, didn’t immediately respond to a request for comment.

Allozyne was founded in 2005 at the Seattle-based Accelerator. Its backers include MPM Capital, OVP Venture Partners, Arch Venture Partners, and Amgen Ventures. The company said in a recent merger document that it had about $1.1 million in cash in the bank, and that it had an accumulated deficit of $49.6 million as of June 30.

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Merck veteran Keith Gottesdiener will become the new CEO of Boston-based Rhythm Pharmaceuticals, a Boston startup developing experimental drugs for the treatment of metabolic conditions such as obesity and diabetes, according to an announcement today.

Gottesdiener oversaw pivotal clinical trials as Merck’s former vice president and late-sage therapeutic group leader, and is joining Rhythm as it pushes two drug programs through clinical development. The biotech is navigating the crowded therapeutic field with two drug compounds it has licensed from the French biotech company Ipsen.

Rhythm’s compound RM-131 could enter a Phase 2 clinical trial early next year as a treatment for a complication of Type 1 and Type 2 diabetes called gastroparesis—a digestive disorder involving the abnormal emptying of the stomach. Rhythm is also aiming to file an FDA application by the end of this year to begin human testing of its compound for curbing food intake in severely obese populations who suffer from diabetes or are at risk of developing the disease.

Rhythm is backed by MPM Capital, New Enterprise Associates and Third Rock Ventures.

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When Boston-based Rhythm Pharmaceuticals started up in 2010 with a plan to develop drugs to address diabetes and obesity, the biotech world was littered with companies struggling to make a mark in those disease areas. San Diego based Arena Pharmaceuticals was fighting to produce data for the FDA showing its obesity drug was safe. Phenomix, also based in San Diego, could no longer afford the FDA-mandated trials for its Type 2 diabetes drug and had to shut down. But the folks at MPM Capital, which started Rhythm by leading a $40 million Series A that closed in September 2010, were undeterred. They licensed two compounds from French biotech company Ipsen that had been tested extensively in animals. “The clarity of the efficacy and safety from those studies—the strength and consistency of the data—led us to believe we could clearly be best-in-class,” says Bart Henderson, co-founder and president of Rhythm.

Rhythm, which is also backed by New Enterprise Associates and Third Rock Ventures, is now completing Phase 1 human trials of its lead compound, RM-131, in patients with Type 2 diabetes. The drug is derived from ghrelin, which is commonly called “the hunger hormone.” Ghrelin is produced in the gut and regulates functions such as food consumption, nutrient absorption, and gastrointestinal motility—the movement of food through the digestive tract.

Several drug companies have tried targeting ghrelin to treat diseases that range from growth-hormone deficiency to muscle degeneration, with limited success. Rhythm is instead going after a common but largely untreated complication of both Type 1 and Type 2 diabetes called gastroparesis, a digestive disorder marked by an abnormal emptying of the stomach. Normally, ghrelin receptors in the gut prompt a well-synchronized handoff of food from the stomach to the rest of the digestive tract. “In diabetes, that process seems to be attenuated, so many patients complain of abdominal pain and bloating,” says Elizabeth Stoner, co-founder and chief development officer of Rhythm. “It causes their glucose control to go amiss, because they’re not really emptying the stomach as expected.”

According to figures Rhythm has collected, about a third of the 25.8 million people with diabetes in the U.S. suffer from gastroparesis, costing the economy $3.5 billion a year. The primary treatment, a generic drug called metoclopramide, can only be taken for a short time because of the risk that it could touch off a potentially dangerous muscle disorder.

If all goes well, Rhythm will start a Phase 2 gastroparesis study in early 2012, Stoner says. Henderson adds that because ghrelin is such an essential hormone, RM-131 could someday prove useful in a range of other diseases, including anorexia and cachexia, or wasting syndrome.

Rhythm’s second compound, RM-493, could address an equally broad population: severely obese people who suffer from diabetes or are at risk of developing it. RM-493 targets melanocortin type 4 receptor (MC4R), which when mutated, is estimated … Next Page »

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When you can sequence an entire human genome for less than $5,000, and the price is diving fast to $1,000, what kinds of questions will your doctor be able to ask about you?

Once all the DNA sequences get generated, and software companies start figuring out better ways to analyze/interpret/visualize all the data, then the medical people are going to get involved in a much bigger way. The real-world uses of all this genomic data is one of the fascinating areas we’re going to explore during Xconomy’s next big event in San Francisco, “Computing in the Age of the $1,000 Genome” on Oct. 24.

We have a tremendous group of speakers for the genomic medicine part of the event. Here’s who you can expect to hear from:

Atul Butte

—Atul Butte, the chief of systems medicine at Stanford University and an associate professor in the department of pediatrics at Stanford’s School of Medicine. Butte made the point at a recent genomics conference that an entire human genome sequence costs less than a colonoscopy. The natural retort is that we don’t yet know how to interpret the information from a whole genome, while doctors have a much better idea of what to do with colonoscopy results. I’m sure Butte has a ready response to that one, because he isn’t just waxing philosophical about this—he’s working to make genomic data useful through his work as a co-founder of a new Palo Alto, CA-based genomic interpretation startup, called Personalis.

Ashley Dombkowski

—Ashley Dombkowski, the chief business officer of Mountain View, CA-based 23andMe. Quite a few biologists snickered at 23andMe in its early days, saying it provided a high-priced and basically useless service for helping patients learn more about their ancestry, genetic quirks, and some iffy predisposition to certain health risks. Not as many scientists are laughing anymore, now that the price for its service has dropped all the way from $999 to $99, and the company suddenly has built a database with more than 100,000 users who can be tapped for questionnaires. Dombkowski, who has a PhD in mathematics, saw the development of the company when she invested in it for MPM Capital. In July, she went in-house as 23andMe’s chief business officer, working on partnerships.

David Ewing Duncan

—David Ewing Duncan, the author of the 2009 book “Experimental Man.” Duncan, who also writes for Fortune, Technology Review, and National Geographic, has personally subjected himself to an incredible number of genetic tests. And if you’ve read the book, you can see this isn’t some kind of “recreational genetics” or celebrity vanity project—he actually seeks to understand what all this emerging genetic information really means for his future health and that of his family. These questions might seem irrelevant today, but I’m confident that as sequencing gets cheaper, it will go mainstream, and many, many more people are going to be asking the same kind of questions Duncan was asking years ago. So I’m excited to have him serving as the moderator this panel with Butte and Dombkowski.

That’s it for this portion of a much bigger half-day event. This medical discussion will come after moderated chats with the people creating much of this new sequence data, and with folks who are building software companies to interpret the deluge of data. We will close with a great keynote chat about the broader societal implications for privacy, and humanity—which I’ll say more about in coming days.

As always with Xconomy events, we will leave time for you to pose your questions to the speakers, and provide plenty of time for networking with them and other attendees. You can get your tickets on the registration page here, where there are discounts for startup companies, and students. See you there on the 24th.

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Kirkland, WA-based Cardiac Dimensions, after 10 years of developing a new device to tighten up leaky heart valves in heart failure patients, is now ready to roll with its first product approved for sale in Europe.

Cardiac Dimensions said today it has been granted permission by European Union regulators to start selling its Carillon Mitral Contour System as a way of treating a common type of congestive heart failure. The company plans to start marketing the product on its own, with its own sales force, in 2012, says CEO Rick Stewart. Insurance reimbursement work is underway with payers in those countries, and Cardiac Dimensions initially has its sights on selling the product in Germany, France, the Netherlands and Belgium, he says.

The company’s device is made to treat a form of congestive heart failure, known as mitral valve regurgitation, in which the heart is no longer able to vigorously pump blood throughout the body. The reason is that the mitral valve loosens up, meaning that when the heart pumps blood out, some of the blood backflows into the heart. Cardiac Dimensions aims to tighten up the valve, and prevent the backflow, by using a catheter to insert a super-flexible alloy wire around the valve to cinch it up tight again. An estimated 3.2 million people in the U.S. have loose mitral valves contributing to their heart failure, although Stewart didn’t provide numbers on the incidence in the EU.

Cardiac Dimensions won EU approval on the basis of trials that involved about 100 patients, Stewart says.

“These things [regulatory approvals] are harder and harder to get these days. The bar for [European clearance] has gone up quite a bit from the standpoint of the amount of patient experience you need to have,” Stewart says.

The EU approval offers a glimmer of hope for returns for Cardiac Dimensions’ investors, who have had to wait a long time. Stewart declined to say how much has been invested in the company, but I reported here two years ago that since 2001, Cardiac Dimensions had raised more than $60 million from a venture syndicate that includes MPM Capital, Polaris Venture Partners, Frazier Healthcare Ventures, and Johnson & Johnson Development Corporation. Cardiac Dimensions pulled in another $6.4 million last November out of a round potentially worth as much as $15 million, according to a filing with the Securities & Exchange Commission.

The company originally won EU approval for an earlier iteration of its device in 2009, but hasn’t commercialized that version because it wanted to develop an improved version to make it easier and more convenient for doctors to use, Stewart says. The company hasn’t yet set the price for its new device, but it plans to compete with a product from Abbott Laboratories, originally developed by Evalve, that now sells for 20,000 Euros, Stewart says.

Because of the large size of the market, with so many … Next Page »

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[Updated 9/13/11 2:30 p.m. See below.] Valeritas, a Bridgewater, NJ-based medical device company, announced yesterday that it has raised $150 million in a Series C funding round. The money will support the company’s lead product, a disposable device designed for patients with Type 2 diabetes who require insulin.

The product, called V-Go Disposable Insulin Delivery Device (pictured above), was approved by the FDA in December 2010. Patients can fill it with insulin and then wear it under their clothing. They can use it to get both a continuous dosing of insulin under the skin and on-demand doses at mealtime. The company plans to use the new funding to support the commercialization of the product, which was also approved in Europe.

Private equity firm Welsh, Carson, Anderson & Stowe led the financing and took a controlling interest in Valeritas, the company said. Also participating in the round were existing investors MPM Capital, Pitango Venture Capital, Abingworth, Advanced Technology Ventures, ONSET Ventures, HLM Venture Partners, Agate Medical Investments, CHL Medical Partners, and Kaiser Permanente Ventures. “We’re very excited that all these investors are expressing a lot of interest in the opportunity Valeritas has,” says CEO Kristine Peterson. “The Type 2 market is large and growing, and we think V-Go provides a real benefit to patients who need insulin.” [This paragraph has been updated with additional details and a quote from Kristine Peterson.]

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Theraclone Sciences acting CEO Steve Gillis dropped a hint earlier this week that he was looking to close another $10 million in financing for the company, and now it’s official.

Seattle-based Theraclone, the antibody drug discovery shop, is announcing today it has raised $10.6 million in an extension to its Series B financing. The Series B deal, originally announced as being worth $29 million in March 2007, has now grown to a total size of $41 million, Theraclone said. Previous investors Arch Venture Partners, Canaan Partners, MPM Capital, Healthcare Ventures, Alexandria Real Estate Equities, Amgen Ventures, and Zenyaku Kogyo participated in the Series B extension, the company said.

Gillis, a managing director at Arch Venture Partners, has been filling in as CEO of Theraclone since June 2010 when Dave Fanning died suddenly. Earlier this week, Gillis told FierceBiotech that he hopes to recruit a permanent CEO for Theraclone once the financing is done.

Theraclone made news earlier this year when it struck an antibody discovery collaboration with New York-based Pfizer (NYSE: PFE) and when its work toward discovering broadly neutralizing antibodies for HIV was featured in Nature. The company, originally known as Spaltudaq, was founded in 2005 at the Seattle-based Accelerator.

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Acquisitions were big again this week, but we saw a range of financings and transactions across energy, biotech, and IT sectors.

—Waltham, MA-based Tecogen, a maker of natural-gas-fueled, engine-driven combined heat and power systems, inked a $500,000 investment from Southern California Gas.

—Verastem, a Boston-based oncology startup founded by MIT biologists Robert Weinberg and Eric Lander, snagged $32 million in Series B funding, led by Advanced Technology Ventures (ATV) and Astellas Venture Management. Existing investors Longwood Founders Fund, Bessemer Venture Partners, Cardinal Partners, and MPM Capital also participated in the deal.

—Prospectiv Direct, an online marketing firm in Wakefield, MA, was bought by Stamford, CT-based Affinion Group for $30 million plus earn-outs over the next two years, in a deal expected to close sometime this quarter. Read more about Prospectiv and Eversave, the daily deals site it owns, in this story here.

—Polaris Venture Partners of Waltham announced it had made its first set of investments from its $375 million sixth fund, which included two Massachusetts companies: Biff Labs and Xtuit.

—In more daily deals news, Boston- and New York-based BuyWithMe bought Edhance of Cambridge, MA, for an undisclosed sum. Edhance provides card-linked offers and customer loyalty programs.

–Waltham-based Affectiva took in $5.7 million in Series B financing led by Kantar (WPP) and Myrian Capital to develop and market its software targeted at emotion recognition.

—LogMeIn (NASDAQ: LOGM), a Woburn, MA-based maker of remote access software, acquired Pachube (pronounced Patch Bay) for $15 million in cash.

—Lexington, MA-based drug developer Inotek Pharmaceuticals raised another $9.3 million to bring its latest financing round up to $23.6 million.

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Menlo Park, CA-based Nevro, which is developing a neuromodulation device for the treatment of chronic back and leg pain, said yesterday that it has raised $58 million in a Series B financing round led by new investor Johnson & Johnson Development Corporation. Existing investors Aberdare Ventures, Accuitive Medical Ventures, Bay City Capital, Mayo Clinic, MPM Capital, and Three Arch Partners also participated in the round. The startup said the funds will go toward a pivotal clinical study of the device’s effects in the U.S. and help support international commercialization.

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This week was full of meaty analysis of drug development programs at New England-area biotechs.

—Waltham, MA-based Avedro took in $25 million, which it will use to expand commercial operations internationally and to seek FDA clearance in the U.S of its technology that uses the pulse in microwave energy to correct vision. The deal was led by SCP Vitalife and Aperture Venture Partners and also included existing Avedro investors Prism VentureWorks, De Novo Ventures, Flagship Ventures, Borealis Ventures, and Echelon Ventures.

—Salient Surgical Technologies, a Portsmouth, NH-based developer of devices that stop bleeding and seal wounds using radio-frequency energy and saline solution, will be bought by Medtronic for $525 million in cash.

—Xconomy New York editor Arlene Weintraub sat down with executives of Amag Pharmaceuticals (NASDAQ: AMAG). They discussed what seems to be the Lexington, MA-based  biotech’s upswing from the beating its stock had taken after the FDA demanded Amag label its first drug, ferumoxytol, with warnings of side effects like anaphylactic-type reactions and abnormal blood-pressure drops. The company’s stock has risen this year with reports from analyst Christopher Raymond of Robert W. Baird & Co. that the worst was over, and Amag’s announcement that the FDA would allow it to tone down the safety language on the drug label.

—Meanwhile, Cambridge, MA-based Idera Pharmaceuticals saw its stock drop this month after it announced that Germany’s Merck KGaA had decided to halt development of a cancer drug the two companies had partering on, because of side effects in patients like a dangerous drop in white blood cells. Idera (NASDAQ: IDRA) still plans to surge ahead with development of its drugs that focus on toll-like receptors, CEO Sudhir Agrawal told Arlene.

—Verastem, a Boston-based oncology startup founded by MIT biologists Robert Weinberg and Eric Lander, raised $32 million in Series B financing. The round was led by Advanced Technology Ventures and Astellas Venture Management and included previous investors Longwood Founders Fund, Bessemer Venture Partners, Cardinal Partners, and MPM Capital.

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Boston-based oncology startup Verastem, which was founded by MIT biologists Robert Weinberg and Eric Lander, has raised $32 million in a Series B financing, the company announced today. Verastem is developing drugs that target cancer stem cells, and it previously raised $16 million from a group led by former Sirtris CEO Christoph Westphal’s Longwood Founders Fund.

Longwood joined this latest funding round, which was led by Advanced Technology Ventures (ATV) and Astellas Venture Management, with participation from the other existing investors, Bessemer Venture Partners, Cardinal Partners, and MPM Capital. Verastem will use the proceeds from the financing to support the development of its drug candidates, which the company is now in the process of selecting, with the goal of getting the first Verastem drug into clinical trials in 2012.

Verastem is focusing on finding treatments for “triple-negative” breast cancer—a form of the disease in which patients’ tumors lack the three key receptors associated with breast cancer that current drugs target: estrogen receptors, progesterone receptors, and human epidermal growth factor receptor 2 (HER2). “There are very limited therapeutic options for these patients and they have a poor prognosis,” says Verastem’s chief operating officer Robert Forrester, who spoke to Xconomy by phone this morning.

Targeting cancer stem cells is one of the hottest concepts in oncology research. Companies ranging from New York drug giant Pfizer (NYSE: PFE) to OncoMed of Redwood City, CA, are all working on drugs that target these stem cells, which … Next Page »

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Any company that aspires to get a listing on the stock market had better be ready for marathon hours with investors, accountants, and lawyers. But there’s a special thicket of challenges to work through when you’re introducing yourself to the NASDAQ the way Seattle-based Allozyne is.

The privately-held biotech company is taking the backdoor route to an IPO by acquiring the shell of a public company—San Francisco-based Poniard Pharmaceuticals (NASDAQ: PARD). So besides running their regular business, a few new tasks have piled up in front of Allozyne CEO Meenu Chhabra and finance chief John Bencich. They need to rustle up another 2.2 million votes from Poniard’s existing shareholder base to authorize the deal and, assuming that happens, they need to introduce themselves and their newly merged company in a hurry to Wall Street.

Poniard’s shareholders, who have lost most of their money on a drug that failed in a trial for small-cell lung cancer, could be excused for feeling too jaded to turn in their votes. And Allozyne is an unknown quantity to most Wall Street investors—it has an unfamiliar protein engineering technology platform, and a lead drug candidate for multiple sclerosis that’s still in the first of three clinical trial stages normally required for FDA approval of a new drug. That basically means it needs to gather a lot more proof that it works before investors, in today’s market, will get excited.

For the always-enthusiastic Chhabra, it just means she’s got a lot of work to do.

“I’ve been doing a lot of cardio,” Chhabra joked, referring to how she’s been shuttling between meetings with investors on the East Coast.

For now, there are some key terms investors need to settle on to seal the deal. Allozyne is asking Poniard shareholders to trade in 15 to 25 of their existing shares to get just one back, in what’s known as a reverse stock split that companies often do to prop up their stock prices above $1. If those terms are accepted, Poniard shareholders will get about 35 percent ownership of Allozyne.

If Poniard shareholders go for the new structure, then Allozyne will have to go about the hard work of redefining the company. Allozyne has raised $43 million since it was founded in 2005, and has gone through long stretches in stealth mode, keeping competitors in the dark. To go public via this route, Allozyne will have to disclose much more about its strategy and risks through a new regulatory filing called an S-4. The document will be similar to an S-1 investor prospectus for a traditional IPO, Bencich says.

Meenu Chhabra

For now, Allozyne’s executives are out doing what they can to prime the pump of interest. “The response is encouraging. It’s a fresh story no one has heard of before,” Chhabra says.

Allozyne considered a conventional IPO, but decided against it. Some biotechs have done well in recent stock market debuts, such as Parsippany, NJ-based Pacira Pharmaceuticals (NASDAQ: PCRX), but several have tried, found little investor appetite, and withdrew IPO paperwork. San Diego-based Ambit Biosciences, and Durham, NC-based Aldagen are a couple recent examples. “If you look at what’s happening in traditional IPOs, there are painful processes,” Chhabra says.

Chhabra is trying to build a base of interest with Poniard shareholders, and then to bolster that interest by setting up a couple of catalytic events. If Allozyne can complete the deal as planned in the late part of the third quarter or early fourth quarter, Chhabra says she has a couple important steps in mind for the early days of the new public company. One, she plans to release more data from the second part of a Phase I clinical trial of Allozyne’s long-lasting multiple sclerosis drug, AZ01, which I reported on first in January at the JP Morgan Healthcare Conference. And two, Chhabra says she plans to … Next Page »

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