New England saw a flurry of life sciences news this week, from venture firms, new startups, and established biotechs.

—Boston-based Avila Therapeutics presented data at the American Society of Hematology from early human trials of its lead cancer drug, AVL-292, which is on track to enter more extensive Phase 2 trials next year. This compound, a so-called covalent drug that bonds tightly to disease-causing proteins to shut down their activity over time, is targeting cancers such as chronic lymphocytic leukemia.

—Alnylam Pharmaceuticals (NASDAQ: ALNY) could be onto something in the field of RNA interference, a technology that has fallen out of favor in the industry, my colleague Luke wrote. The Cambridge, MA-based biotech reported at a scientific meeting last month that one of its experimental RNAi drugs was able to shut down production of a protein that causes a rare and deadly disease called TTR amyloidosis.

—ImmusanT, a new startup working on therapies for celiac disease, inked a $20 million Series A financing from Vatera Healthcare Partners. The Cambridge-based company is developing a vaccine and a diagnostic and monitoring test for the condition, which renders the protein gluten toxic in the body.

—Newton, MA-based AesRx kicked off human trials of its lead drug Aes-103, a treatment for sickle cell disease. A partnership formed with the National Institutes of Health helped the company get this far, after it struggled to raise venture funding.

—Boston-based Ember Therapeutics raised $34 million from Third Rock Ventures to develop drugs that fight obesity by burning off … Next Page »

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Obesity is one of the biggest public health problems of the 21st century, and now a Boston biotech startup is looking to fight it in an unorthodox way. The bet at Ember Therapeutics is that it can coax the body to burn off some of that unwanted fat.

The company is emerging from stealth mode today with a $34 million Series A financing from Boston-based Third Rock Ventures. The idea is to make drugs that take advantage of some of the new understanding about “brown fat,” a type of tissue that helps mammals to burn off the more familiar “white fat” tissue that stores excess energy. The company has recruited some big name advisors from the brown fat field, including Bruce Spiegelman of the Dana-Farber Cancer Institute, Patrick Griffin of The Scripps Research Institute in Florida, and Ron Kahn of the Joslin Diabetes Center.

Ember (not to be confused with the Boston wireless sensor network firm with that name) is being born during a rough time for the obesity drug business, as public companies like Arena Pharmaceuticals (NASDAQ: ARNA), Orexigen Therapeutics (NASDAQ: OREX), and Vivus (NASDAQ: VVUS) have all failed to win FDA approval for new weight loss drugs. Regulators have often cited underwhelming effectiveness, along with various safety concerns for pills that have potential to be taken by millions of people with a condition that isn’t immediately life-threatening. But obesity does lead to a wide variety of expensive, chronic health problems like diabetes, heart disease, arthritis, and depression. The potential market for an effective new weight loss drug is huge, as an estimated one-third of U.S. adults are obese and another one-third are considered overweight.

Lou Tartaglia

Third Rock’s bet is that it can come up with a more effective alternative through this new biology that seeks to help people burn off excess calories, rather than more traditional approaches that seek to work on the central nervous system by suppressing appetite.

“We can’t wait to get going,” says Third Rock partner Lou Tartaglia, the interim CEO of Ember.

Scientists have long known that newborns have a lot of brown fat, which is loaded with mitochondria that expend energy, and release heat to keep them warm. Most of this tissue disappears as people grow up, and adults begin to accumulate more “white fat” which stores excess energy from food we eat. But recent discoveries using positron emission tomography (PET) scans have shown that adults do retain some small amounts of brown fat tissue (usually along the back) which sends signals to burn excess white fat, Tartaglia says.

What’s interesting from a pharmaceutical perspective is that scientists have now identified biologic pathways that suggest it could be possible to “recruit and augment” the brown fat tissue that’s already operating in the body, Tartaglia says. Ember, which takes its name from … Next Page »

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A couple of months ago, the publisher and CEO of the weekly Strategic News Service Newsletter introduced an article by San Diego Xconomist Larry Smarr, saying, “This issue may be the most important Special Letter we have ever published.”

Smarr’s 23-page article, which takes up the newsletter’s entire Sept. 26 issue, is part scientific paper and part personal odyssey into what Smarr calls his “Quantified Health.” In the 10 years since he moved to San Diego to become founding director of the UC system’s California Institute for Telecommunications and Information Technology (CalIT2), Smarr has scrupulously measured and analyzed his own biological data. In his paper, Smarr writes, “What I have learned about myself both illustrates and foreshadows the ongoing digital transformation of medicine.”

Xconomy Biotech Editor Luke Timmerman previewed this personal experiment last year after Smarr gave a presentation in Seattle. Smarr tells me he initially began by simply charting his weight. “I really wasn’t paying attention to my weight and general health until I came to San Diego from Illinois in 2000,” he says. “Once I looked around at all the fit people here I realized I better pay attention or I might get sent back to the Midwest!”

Through the years, however, Smarr has expanded his survey to include regular blood tests to monitor more than 60 biochemical markers. He now keeps meticulous notes on his diet, exercise, and supplemental vitamins, saying, “I routinely use food and supplements to ‘tune my numbers’ to more optimal levels.” Smarr says he uses the BodyMedia armband and the Fitbit clip to measure his physical activity, caloric burn, and sleep efficiency. He uses the Zeo device to monitor his sleep patterns and the HeartMath‘s emWave Desktop program to measure his stress and train himself to relax.

In 2005, when Smarr detected unusually high levels of a key blood marker for inflammation, his scientific quest escalated to a whole new level of detail—one that included tracking multiple biomarkers in his own stool samples and even obtaining an analysis of his DNA. “Yet this is precisely what the digital revolution in healthcare is all about,” Smarr writes. “The combination of trend-revealing graphs of time series of individual biochemical markers, with population-wide comparisons to people with different health outcomes is transforming biomedical research and ultimately clinical care, into an entirely new paradigm. In this new world, we become personally responsible for … Next Page »

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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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All this talk about quarterly earnings and venture stats reminded me: I never posted my favorite stories from Xconomy Boston’s third quarter.

Yes, I know it’s almost the end of October, and the third quarter ended a month ago. I must have been traumatized by the collapse of the Red Sox or something (is baseball still going on?). Go ahead, run me out of town like Theo and Tito.

This time, I’m not consulting with my colleagues. I’m a rebel, a maverick. I work alone. Without further ado, here are my favorite stories from July through September:

Top 10 Tech Stories:

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It was a meaty New England life sciences week, with clinical advances, new funding, CEO hires, and acquisitions headlines.

—Sanofi hired David Meeker as the new CEO of its Cambridge, MA-based Genzyme unit. Meeker, who got started at the company in 1994, will move into his new role on November 1 and will lead the rare diseases and multiple sclerosis divisions. Other Genzyme units have already been integrated into Sanofi’s global operations.

—My colleague Arlene took a closer look at Cambridge-based Rhythm Pharmaceuticals, a startup developing diabetes and obesity drugs. Rhythm is navigating a crowded but struggling drug space with licensed compounds from the French biotech company Ipsen.

—Lexington, MA-based Cubist Pharmaceuticals (NASDAQ: CBST) will acquire Adolor for $4.25 per share in cash ($190 million total), plus milestones for Adolor’s experimental drug for treating chronic opioid-induced constipation, ADL5945. That pushes the total value of the deal to $415 million. The transaction was made possible, Cubist says, when pharma giant GlaxoSmithKline (NYSE: GSK) dropped out of a co-promotion deal with Adolor (NASDAQ: ADLR) after their drug for accelerating healing after bowel surgery ran into safety issues and was only cleared for in-hospital use.

—Weston, MA-based Biogen Idec (NASDAQ: BIIB) met its goals in a second clinical trial of its first pill for multiple sclerosis. In the study, Biogen’s pill reduced MS flareups by 44 percent when patients took it twice a day, and by 51 percent when they took it three times a day. The company’s stock shot up 7.6 percent to $115.07 per share at 10:06 Eastern time after the news. Biogen also announced it would pay $45 million upfront to South San Francisco-based Portola Pharmaceuticals to collaborate on autoimmune disease drugs.

—Atreaon, a new Newton, MA-based biotech company, raised $8 million of a potential $20 million equity round, according to an SEC filing. And Watertown, MA-based Arsenal Medical, a developer of biomaterial-based treatments, said it was spinning out a new company called 480 Biomedical. It also announced it had raised $3 million and 480 had raised $15 million, from return Arsenal investors return investors Polaris Venture Partners, North Bridge Venture Partners, and Intersouth Partners. The new spinout will focus on developing scaffold and delivery technology for treating a form of peripheral vascular disease known as SFA occlusive disease.

—Cambridge-based BIND Biosciences and Watertown-based Selecta Biosciences each received $25 million from Rusnano, a $10 billion Russian federation fund focused on nanotechnology startups. Each company, which will establish Moscow subsidiaries, also took in another $22.25 million from new and existing investors.

—Cambridge-based Vertex Pharmaceuticals (NASDAQ: VRTX) announced revenues of $659 million for the quarter ended September 30, its first ever profitable quarter from its own product sales. (Vertex turned a profit once before due to a one-time milestone payment.) The $221 million ($1.02 a share) profit last quarter was drive in part by Vertex’s new FDA-approved drug telaprevir (Incivek) for patients with hepatitis C that was cleared by the FDA in May.

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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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San Diego life sciences research and development, the engine that drives innovation, got some new digs at Isis Pharmaceuticals, and J. Craig Venter started the digging for the construction of a new genomics research headquarters. But we didn’t have to go digging for news; our roundup begins now.

—After meeting with federal regulators, San Diego’s Orexigen Therapeutics (NASDAQ: OREX) said it is restarting work on its experimental diet pill, a combination of naltrexone and bupriopion (Contrave), after declaring in June that it was suspending development of the drug. Orexigen shelved the program after the FDA said the company still needed to conduct a costly, long-term clinical study of more than 60,000 patients to demonstrate that the proposed diet pill wouldn’t increase the risk of heart attack or stroke. Orexigen found a way to move forward, however, by proposing a two-year cardiovascular study that would enroll 10,000 patients. Orexigen said the FDA’s feedback was “reasonable and feasible.”

—San Diego-based Independa, a wireless health startup developing technology to help seniors live independently, raised $1.6 million in an early stage financing round involving Miramar Venture Partners and City Hill Ventures, with an additional $200,000 loan from Silicon Valley Bank. Independa plans to spend the money on development of its Software-as-a-Service (SaaS) technology and to expand its marketing and distribution.

—NuVasive (NUVA: NUVA), the San Diego medical device company developing new surgical products and techniques for repairing the spine, said it gave more than it got in a continuing patent dispute with Medtronic. While a formal judgment has not yet been entered, a jury reviewing four of the nine contested patents determined that Medtronic should pay NuVasive $660,000 plus interest for infringing on a NuVasive patent. The jury also found that NuVasive should pay Medtronic $101 million plus interest for infringing three Medtronic patents.

—San Diego scientist J. Craig Venter and local dignitaries attended a ceremony Tuesday as construction began on a new $35 million building to house the West Coast headquarters for the J. Craig Venter Institute (JCVI). It’s going in near the Salk Institute and the new Sanford Consortium for Regenerative Medicine. A JCVI spokeswoman said the 45,000-square-foot building will be support 125 scientists and staff in a state-of-the-art, carbon-neutral building on the UC San Diego campus. The work will be focused on genomic research, including human genomic sequencing and analysis, synthetic genomics, and environmental genomics.

—Carlsbad, CA-based Isis Pharmaceuticals (NASDAQ: ISIS) has completed the consolidation of three R&D facilities into a single corporate and research facility. An Isis spokeswoman said the company’s 320 employees continue to be focused on research and drug development, with technology that enables the company to move three to five new drugs into its pipeline every year. The cholesterol-reducing drug mipomersen is the company’s most advanced drug.

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Orexigen Therapeutics was left for dead earlier this year when its obesity drug was shot down by the FDA. But today it had a message for investors that could be interpreted as “hold on, we might not be dead yet after all.”

The San Diego-based biotech company (NASDAQ: OREX) said today that has decided to re-start development of its weight loss combo drug, naltrexone and bupropion (Contrave) after a recent meeting with the FDA to discuss the steps needed to seek approval once again. Orexigen walked away from the recent meeting feeling that the FDA’s clarified guidance was “reasonable and feasible and provide the certainty required to reinitiate development of Contrave,” the company said in a statement today.

Orexigen stock shot up 86 percent in after-hours trading after the announcement to $2.73 a share at 8 pm Eastern.

“We are encouraged by this development as it offers Orexigen a path forward, which previously did not appear to exist,” said JP Morgan analyst Cory Kasimov, in a note to clients.

The FDA has been tough on makers of new weight loss drugs lately. It has demanded loads of data to prove they are safe since there’s potential for them to be used by millions of people with a chronic condition that isn’t immediately life-threatening.  Three major competitors, San Diego-based Arena Pharmaceuticals (NASDAQ: ARNA), Orexigen, and Mountain View, CA-based Vivus (NASDAQ: VVUS), all had new drug applications turned down by the FDA in the past year. In Orexigen’s case, regulators asked for a long-term study to show that the new product wouldn’t raise the risk of a heart attack or stroke. That’s often a show-stopper in biotech, since such studies can take years, thousands of patients, and millions of more dollars.

But apparently Orexigen says it has found a way forward that’s practical for the company and acceptable to the FDA. After further negotiating over trial designs, Orexigen said it agreed with FDA on a plan to enroll overweight and obese patients in a study that would require 87 total cardiovascular events (heart attacks or strokes) before statisticians try to suss out any difference between the new drug and placebo. Orexigen’s math says such a study could enroll fewer than 10,000 patients, and generate an interim analysis within two years of initiation. Orexigen says it hopes to start the cardiovascular study in the first half of 2012, in hopes of re-submitting its application to the FDA and winning approval in 2014.

Orexigen’s original application included data from 4,500 patients. The company has lost more than $337 million since its founding in 2002, according to its most recent quarterly report.

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We saw an interesting mix of financings, collaborations, and research news from New England’s drug and medical device developers this week.

—HealthCare Ventures put $15 million in Series A funding into Cambridge, MA-based Tensha Therapeutics, a startup developing small-molecule drugs designed to treat cancer and other diseases by regulating the expression of disease-associated genes.

—Boston’s Brigham and Women’s Hospital said it will use technology from Cambridge-based GNS Healthcare (part of Via Science) to help manage the cost of treating congestive heart failure patients. GNS Healthcare will apply its computer simulation models to predict the likelihood that the hospital patients will experience adverse drug events or readmission.

—Henri Termeer, who was CEO of Cambridge-based Genzyme before its acquisition by Sanofi-Aventis, donated $10 million to Massachusetts General Hospital to establish the new Henri and Belinda Termeer Center for Targeted Therapies. It will focus on developing more personalized cancer drugs, initially for certain genetic forms of breast cancer, lung cancer, and leukemias.

—Natick, MA-based Boston Scientific (NASDAQ: BSX) revealed that it will be bringing in Michael Mahoney as president starting next month and as CEO in November 2012. Current CEO Ray Elliott announced in May that he’d be stepping down; soon-to-be interim CEO Hank Kucheman will have the job until Mahoney, formerly worldwide chairman of Johnson & Johnson’s medical device and diagnostics group, takes the chief executive role.

—GI Dynamics, a Lexington, MA-based medical device developer, went public on the Australian stock exchange to raise the $80 million it needed to get through the next three years, wrote Xconomy New York editor Arlene Weintraub. The company is looking to get regulatory approval for its device to be used as a treatment for obesity and type 2 diabetes.

—NABsys, a Providence, RI-based maker of gene-sequencing tools, took in a $10 million Series C investment from Stata Venture Partners. The Needham, MA-based firm, founded by semiconductor pioneer Ray Stata, also led NABsys’ $7 million Series B funding round. The startup said it will use the new financing for development and commercialization of its solid-state electronic systems for single-molecule DNA sequencing and analysis.  The company is similar to Ion Torrent, a new unit of Carlsbad, CA-based Life Sciences that’s using semiconductor technology in its gene-sequencing machine.

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Earlier this year, Lexington, MA-based GI Dynamics faced a challenge that’s all too common these days in life sciences: It needed to raise $80 million to get through the next three years, and there are limited options for medical-device companies seeking that much cash. The company is developing a weight-loss device, and the money was vital to commercialize the product overseas and start new U.S. trials.

“The U.S. IPO market was closed,” says Michael Carusi, a general partner at Advanced Technology Ventures (ATV), one of GI Dynamics’ early investors. “And we didn’t want to do two $40 million private rounds.”

So on September 7, GI Dynamics went public on the Australian stock exchange, which, when combined with a simultaneous private offering, brought in all $80 million. Why Australia? First of all, GI Dynamics introduced its device, called EndoBarrier Gastrointestinal Liner, to the Australian market last month. “When companies launch products in a market, investors there hear buzz,” Carusi says. Secondly, he adds, Australian investors have more of a buy-and-hold mentality when it comes to life sciences companies than U.S. investors do.

That patience will likely come in handy for GI Dynamics’ investors. The company hopes to get regulatory approvals around the world to use its device to treat two separate but related epidemics: obesity and Type 2 diabetes. It’s an ambitious plan, especially at a time when the FDA is under pressure to improve its scrutiny of medical devices. Regulatory approval in the U.S. vs. other countries, says GI Dynamics CEO Stuart Randle, “will be a much longer process.”

The EndoBarrier is a two-foot-long device that doctors can implant into the intestine during a minimally invasive endoscopic procedure. It acts as a block along part of the intestine wall, which slows down digestion and … Next Page »

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New England biotech firms are roaring out of summer with news of fundraising, hires, regulatory moves, and acquisitions.

—Cambridge, MA-based medical imaging startup Lantos Technologies announced a new round of funding and a new CEO. The firm pulled in $4.1 million in Series B money—led by return Lantos investor Excel Venture Management and with participation from previous backers Catalyst Health Ventures and Mass Medical Angels—and hired former Biocius Life Sciences CEO Jeffrey Leathe as its new chief executive.

—Merck KGaA’s Billerica, MA-based subsidiary EMD Millipore said it had agreed to acquire Amnis of Seattle for an undisclosed sum. Amnis spun out of the University of Washington in 1998 and makes an imaging device providing detailed images of a large number of cells.

—GI Dynamics, a Lexington, MA-based developer of medical devices for treating diabetes and obesity, went public in Australia, raising $85 million USD in its IPO.

—Xconomy national biotech editor Luke Timmerman profiled George Scangos and his path as chief executive of (for now) Weston, MA-based Biogen Idec (NASDAQ: BIIB).

—Waltham, MA-based Repligen is finishing up its application for FDA approval of synthetic human secretin (SecreFlo), a hormone-based drug designed to enhance MRI images of the pancreas, as my colleague Arlene wrote. The product has already nabbed fast-track status from the FDA, meaning Repligen will receive a verdict from the agency within six months of submitting the application.

—Pfizer said it will be adding space for 300 employees in Cambridge’s Kendall Square, with a 10-year lease for more than 180,000 square feet. The company had previously announced job cuts in its global research and development operations.

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Lexington, MA-based GI Dynamics, a medical device developer focused on treating obesity and diabetes, has raised $85 million ($80 million in Australian dollars) in an initial public offering in Australia, according to an online report from The Australian.

Earlier this summer the firm indicated that it hoped to go public in Australia, bringing in between $85 million and $102 million in U.S. dollars.

GI—backed by Advanced Technology Ventures, Cutlass Capital, Domain Associates, Johnson & Johnson Development, Polaris Venture Partners, and Seedling Enterprises—has been developing an intestinal liner and other devices aimed to limit the absorption of calories and nutrients in the gut. The products are designed to be less invasive than the cutting and stapling required for gastric bypass surgeries.

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Vivus (NASDAQ: VVUS), the Mountain View, CA-based developer of drugs for obesity and erectile dysfunction, said today it has raised $45.8 million in a stock offering. The company agreed to sell about 6.9 million shares of stock at $6.65 apiece. Funds managed by QVT Financial were the lead investors in the deal, while two other existing investors participated, Vivus said. The stock offering was priced at about a 6.5 percent discount to yesterday’s closing stock price of $7.10.

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[Updated 8/4/11, 6:55 pm. See below.] San Diego’s Amylin Pharmaceuticals (NASDAQ: AMLN) and Japan’s Takeda Pharmaceutical threw in the towel today, saying they are discontinuing development of pramlintide/metreleptin for the treatment of obesity.

[Updated 8/4/11, 6:55 pm to clarify explanation] Observers feared something like this might happen in March, when Takeda and Amylin suspended a clinical trial examining the safety and effectiveness of the compound, which combines pramlintide, an analog of the natural hormone Amylin, with metreleptin, an analog of human leptin. The program was in mid-stage development as a formulation for twice-a-day injection. The partners halted the study voluntarily to investigate antibody-related findings with metreleptin in two patients who had been participating in a broader obesity trial.

A spokeswoman for Amylin, however, tells me in an email this evening, “the joint decision to discontinue the pramlintide/metreleptin program was not related to the March announcement, but rather to the reasons specified in this afternoon’s press release.”

In their statement, the companies said their joint decision was based on a commercial reassessment of their prospects as well as “evolving dynamics” within the field of obesity therapeutics. Amylin and Takeda plan to evaluate other assets for treating obesity under the terms of their existing collaboration agreement. The two companies signed that agreement in late 2009, a partnership deal that was once valued at more than $1 billion for Amylin.

Amylin CEO Dan Bradbury told Luke in January the company was still working on getting the right formulation of metreleptin and pramlintide before moving to a late-stage clinical trial.

[Updated 8/4/11, 6:55 pm to correct nature of single heart study required by FDA] Amylin said earlier this week it had re-submitted its application to the FDA for another drug—exenatide once-weekly (Bydureon)—with two partners, Indianapolis-based Eli Lilly (NYSE: LLY), and Waltham, MA-based Alkermes (NASDAQ: ALKS). In an unexpected move last October, the FDA refused to approve exenatide once-weekly for sale to U.S. diabetes patients until the partners conducted a study focused on an irregular heart rhythm known as QT prolongation.

In their statement today, Amylin and Takeda said the abandoned study was not expected to require either company to revise its latest financial guidance for their respective 2011 fiscal years.

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The IPO market seems to be heating up around the country, but will Boston get left behind? A couple of local companies are trying to do their part, joining the likes of Kayak, Carbonite, and others that have filed papers to go public.

The latest ones are GI Dynamics, a medical device maker targeting obesity and diabetes, and Exa, which makes simulation software to help auto makers test aerodynamics and other features of their vehicles.

—Lexington, MA-based GI Dynamics has filed paperwork in Australia for an initial public offering of between $80 million and $95 million in Australian dollars—roughly $85 million to $102 million in U.S. dollars. Shares won’t be issued until August 11 at the earliest. Starting in 2008, Xconomy profiled GI Dynamics’ efforts to test and gain regulatory approval for its experimental intestinal liner that limits absorption of calories and nutrients in the patient’s gut, as well as subsequent developments. The company’s investors include Advanced Technology Ventures, Cutlass Capital, Domain Associates, Johnson & Johnson Development, Polaris Venture Partners, and Seedling Enterprises.

—Burlington, MA-based Exa filed a form S-1 with the SEC stating that it plans to raise up to $86.25 million in its IPO. Exa makes software for modeling complex fluid flow, which can be applied to problems of aerodynamics, wind noise, and heat management in cars and trucks. The company says it’s profitable and its annual revenues have increased for 17 consecutive years since its first commercial revenue in 1994. Its investors include Fidelity Ventures and Boston Capital Ventures.

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[Updated: 9:50 am ET] San Diego-based Arena Pharmaceuticals faces a lot of questions that need to be answered before it can hope to win FDA clearance to sell its obesity pill. Now the drug developer says it has at least one piece of the puzzle it hopes will satisfy U.S. drug regulators.

Arena (NASDAQ: ARNA) is announcing today that a new study of nine patients shows the obesity drug lorcaserin (Lorqess) enters the cerebrospinal fluid at far lower concentrations in human beings than it does in rats. This latest human trial was designed to answer one of the questions the FDA raised when it turned down Arena’s application last October. The agency, looking at Arena studies that showed an increased risk of brain tumors in male rats on extreme high doses of the drug, raised a theoretical risk that the same might be true in humans, even though it wasn’t observed in clinical trials.

The company suffered a major blow last October when the FDA raised that objection, among others, in turning down Arena’s application. It prevented Arena, and its partner, Eisai Pharmaceuticals, from immediately entering what could be a multi-billion dollar market for a new weight loss pill. The drug passed its clinical trials, which had enrolled more than 7,000 people, although the FDA said Arena’s weight-loss compound offered only “marginal” effectiveness. Besides that, regulators raised questions about the brain tumors in male rats, breast tumors in female rats, and about the compound’s potential for abuse in the marketplace, among other things. Arena has said it is working with the FDA to answer its questions in hopes of re-submitting a revised application by year’s end.

To say a lot is riding on Arena’s re-submission is an understatement. Arena has raised more than $1 billion since its founding in 1997, and it is still hoping that lorcaserin will become its first marketed product.

“This is what the FDA wanted us to do, so we are happy to come out with a win,” says Arena CEO Jack Lief.

[Corrected reference to rat blood concentration.] Here’s what the study was designed to show. It enrolled nine obese patients, who took the Arena drug twice-daily for 7 days, and then they gave blood, and spinal fluid. The drug is designed to stimulate a receptor in the brain that’s thought to make people feel full and stop eating, so researchers believe it has to get into the spinal fluid to work. But too much could be a bad thing. Based on this study, Arena found that about 1.7 times more of the drug gets into the spinal fluid than in the bloodstream. That number gave Arena some comfort, because it is far less than the 24 times greater concentration that was seen in the male rat brains compared with the concentrations seen in rat blood, in rats that had no brain tumor.

Arena’s prior studies of humans only looked at the amount of drug that got into the bloodstream, so it really only had extrapolations of how much of the drug was getting into the spinal fluid. Before this latest study, company estimates were that a higher amount of the drug would get into the human spinal fluid, Lief says.

While Arena says the new study gives it greater confidence that a safe amount of drug is getting into the spinal fluid, it did emphasize that it doesn’t speak for the FDA. In the last line of today’s statement, Arena says, “the FDA also may or may not view the estimates as reliable or predictive of the safety margin.” So this is a story that will take a good while longer to play itself out at the FDA.

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Boston-area IT, energy, and life sciences firms are making up for a short week last week with plenty of headlines on acquisitions and venture investments this time around.

—Waltham,MA-based business software maker DynaTrace was bought by Detroit-based Compuware (NASDAQ: CPWR) for $256 million in cash, a deal that closed on July 1. DynaTrace, whose technology enables companies to manage the performance of their software applications, has raised $22 million since its founding in 2005.

—Boston-based EnerNOC (NASDAQ: ENOC), a energy management and demand response technology provider, bought Energy Response, Australia and New Zealand’s largest demand response provider, for an undisclosed sum.

—Zafgen, a Cambridge, MA-based developer of obesity drugs, bagged a $33 million Series C round led by its existing investors, including Third Rock Ventures and Atlas Venture. The deal doubled Zafgen’s total financing to $66 million.

—Maynard, MA-based Allegro Diagnostics added another $5.4 million to its Series A funding round, from existing investors Kodiak Venture Partners and Catalyst Health Ventures.

—Waltham-base med tech startup Avedro nabbed a $25 million Series C financing led by SCP Vitalife and Aperture Venture Partners, with participation from previous backers Prism VentureWorks, De Novo Ventures, Flagship Ventures, Borealis Ventures and Echelon Ventures. The company is … Next Page »

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New England biotechs and devices firms have been active in nabbing partnerships, landing investments, and progressing with clinical programs this week.

—Syndax Pharmaceuticals, an epigenetics startup out of Waltham, MA, revealed three sets of data on its lung cancer drug at the Study of Lung Cancer conference this week. The drug, entinostat, is in Phase 2 clinical testing, and acts against certain enzymes that influence specific epigenetic alterations that drive cancer growth and drug tolerance. Syndax aims to combine the drug with other cancer drugs to treat tumors that haven’t responded to other therapies.

—Xconomy national biotech editor Luke Timmerman caught up with Alkermes CEO Richard Pops about his plans to turn the Waltham, MA-based company into a biotech powerhouse. Alkermes (NASDAQ: ALKS), Luke wrote, has seen its stock climb about 30 percent since it announced its plans in May to buy Elan Drug Technologies for $960 million.

—Rib-X Pharmaceuticals could pocket about $772 million through a research and licensing agreement it inked with Sanofi (NYSE: SNY) surrounding Rib-X’s RX-04 program for the treatment of resistant Gram-negative and resistant Gram-positive infections. Sanofi payed $10 million upfront, with another potential $9 million to come in research milestones. Each product selected through the program could earn Rib-X up to $186 million in a mix of development, regulatory, and commercial milestones.

—Cambridge, MA-based obesity drug developer Zafgen nabbed a $33 million Series C financing led by existing investors such as Third Rock Ventures and Atlas Venture, to put toward advancing its lead drug candidate through Phase 2 clinical trials. The deal doubles Zafgen’s funding pot to $66 million.

—Maynard, MA-based Allegro Diagnostics, which is developing a platform for the early detection of lung cancer, said that it added another $5.4 million in Series A extension financing, from existing investors Kodiak Venture Partners and Catalyst Health Ventures

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Obesity drug developer Zafgen is announcing today that it has closed a $33 million Series C financing led by its existing investors, including Third Rock Ventures and Atlas Venture. This doubles the total amount of cash raised by the Cambridge, MA-based startup to $66 million.

Zafgen CEO Thomas Hughes says the company will use the proceeds to move its lead weight-loss drug candidate through Phase 2 clinical trials. In January, Zafgen announced that in an early-stage, one-month trial, its lead drug candidate helped patients lose 2.2 pounds a week. And on June 24, it said that in a Phase 1B trial, the drug produced significant improvements in low-density lipoprotein (LDL) cholesterol, triglycerides, and C-reactive protein (CRP) levels—all important markers of cardiovascular risk that are typically elevated in people who are overweight.

Hughes says the company’s experimental drug—a methionine aminopeptidase 2 (MetAP2) inhibitor called ZGN-433— has exceeded expectations. “We’ve established a rate of weight loss that’s about two-to-four times what one sees in other investigational agents,” Hughes says. “And we see almost a complete normalization of cardiovascular risk.”

Zafgen is currently completing a second Phase 1b study and plans to begin the Phase 2 early next year. The company has also been reformulating the molecule, transforming it from an intravenous drug that has to be given in a medical facility to a “subcutaneous” form that patients could give themselves at home, in an injection just below the skin. Prior to starting the Phase 2, Hughes says, the company will complete a small trial to show the new formulation is as safe and effective as the old one.

The folks at Zafgen seem undeterred by the FDA’s recent rejections of obesity drugs. Mountain View, CA-based Vivus (NASDAQ: VVUS) and San Diego-based Arena Pharmaceuticals (NASDAQ: ARNA) both failed to get their experimental obesity treatments cleared by the FDA. More recently, shares of San Diego-based Orexigen Therapeutics (NASDAQ: OREX) plummeted after the FDA said it would need to see results from a study of long-term cardiovascular outcomes before it would consider approving the company’s combo treatment naltrexone and bupropion (Contrave).

Hughes says he’s kept a close ear to the ground during the FDA’s discussions about those drugs—even going so far as … Next Page »

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