This was the week that a little biotech company in Bothell that few of the locals have ever heard of, burst onto the national stage.

—Bothell, WA-based Alder Biopharmaceuticals had its breakout moment this week when it pulled in $85 million in upfront cash, and stands to gain more than $1 billion over time from a partnership with Bristol-Myers Squibb to co-develop a new drug for rheumatoid arthritis. Clinical trial data on this drug hasn’t yet been released publicly, but CEO Randy Schatzman says it’s good enough to give market-leading drugs from Amgen and Abbott Labs a “run for their money.” Seattle Genetics CEO Clay Siegall, an Alder director, says it is now a “force” in regional biotech.

—Over in Seattle’s South Lake Union, another little-known private company called Kineta said it is splitting a little more than half of a federal contract with the University of Washington worth $13 million over the next five years. The goal will be to develop new chemical compounds, called adjuvants, that can boost the effectiveness of a wide variety of vaccines.

—The Institute for Systems Biology is continuing to net a lot of grant money, this week announcing that it has pulled in $8 million from the National Institutes of Health to contribute to The Cancer Genome Atlas. This is a genomic effort to identify potential new targets for cancer drugs.

—The battle between Seattle-based ZymoGenetics (NASDAQ: ZGEN) and Bristol, TN-based King Pharmaceuticals is heating up in federal court in Tennessee. If you’ve missed any of the back-and-forth, or how this ball really got rolling back in August, here’s a quick summary.

—Bellevue, WA-based Light Sciences Oncology, another private company that keeps a low profile, revealed in a regulatory filing that it has lined up another $35 million to support its drug-device combination therapy for cancer. The money is available in the form of a line of credit, and if investors choose to exercise warrants.

—Bothell, WA-based Verathon, the maker of a simple ultrasound tool for diagnosing bladder disorders, was acquired by Sarasota, FL-based Roper Industries (NYSE: ROP) as part of a pair of transactions valued at $356 million. The companies aren’t saying how much of that is going to the Verathon shareholders.

—Seattle-based Dendreon (NASDAQ: DNDN), the king of the moment in Seattle biotech, issued a pretty vanilla quarterly report with the Securities and Exchange Commission. One point worth noting was that it burned $28 million of its cash reserves in the three-month period ending September 30. It ended that quarter with $259.6 million in cash and investments left in the bank as it prepares to manufacture and market sipuleucel-T (Provenge) next year for men with terminal prostate cancer.

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Alder Biopharmaceuticals keeps such a low profile that even after five years in business, few people in Seattle biotech know who they are. That changed yesterday as the private Bothell, WA-based company burst onto the local, and national, biotech scene by striking a deal with Bristol-Myers Squibb that could be worth more than $1 billion over time to create a new drug for rheumatoid arthritis.

Alder obviously was playing with a strong hand of cards in negotiations with multiple pharmaceutical companies, even though it hasn’t yet disclosed the results of a 120-patient clinical trial of its ALD518 drug candidate that ended this summer. But Alder has been working behind the scenes for months on this deal, and there were several serious bidders, says CEO Randy Schatzman.

Alder ultimately chose Bristol-Myers (NYSE: BMY) because it has experience in the rheumatoid arthritis field through its FDA-approved abatacept (Orencia) therapy, deep pockets, and a “very aggressive” plan to develop and market Alder’s drug not just for rheumatoid arthritis, but for a variety of disorders in which the immune system attacks healthy tissue, Schatzman says. This means that Alder’s drug, which is made to block an inflammatory protein known as IL-6, is thought to have the same kind of far-reaching potential that other biotech drugs that interfere with a different inflammatory protein called TNF. This approach could offer doctors an alternative to the $10 billion-a-year class of biotech drugs, like Amgen’s etanercept (Enbrel) and Abbott Laboratories’ adalimumab (Humira).

When asked directly whether Alder’s clinical trial shows it is competitive with the Amgen (NASDAQ: AMGN) and Abbott (NYSE: ABT) drugs, Schatzman said this:

“We think we’re going to give them a run for their money.”

Seattle Genetics co-founder and CEO Clay Siegall, an Alder board member, added, “This is a superb deal. It gets Alder on a trajectory for becoming one of the important biotech companies in Seattle. They are turning from a startup into a real emerging company.”

To really emerge, Alder sought a partner that had more than just money, but also a bold view of the opportunities with ALD518 and how to capitalize on them. “Their vision is for the same development plan we’d have if we had deep pockets,” Schatzman says. “This is not just for rheumatoid arthritis, but for other autoimmune diseases in which IL-6 is an important player. It’s a very aggressive approach.”

Everyone outside the company will have to wait to see just how good the Alder drug really is. That’s because the company applied for a late-breaking presentation slot at last month’s …Next Page »

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The news has been breaking fast and furious here at Xconomy, just as we are putting the finishing touches on a terrific event on Monday that will explore the 20-year outlook for the Seattle region as a life sciences hub.

—Xconomy dug up an exclusive late Friday afternoon from a couple SEC filings that showed Seattle-based Dendreon has added two heavy hitters to its board of directors. They are Ian Clark, the incoming CEO of the Genentech unit within Roche, and Pedro Granadillo, the former senior vice president of manufacturing at Eli Lilly. Dendreon (NASDAQ: DNDN) announced the move officially, and the wire services picked up the report, on Monday.

—Amgen generates $15 billion a year in revenue, and plows back 20 cents on the dollar, or about $3 billion, back into research and development. But what does it really do with that money, and what ideas does it have to improve on the industry’s abysmal 1-in-10 average success rate for new drugs entering clinical trials? Senior vice president Joe Miletich offered up some fascinating insights on what Amgen is trying to do, and how Seattle and Boston teams contribute, in an exclusive interview.

—Leroy Hood, the biotech pioneer who has started more than a dozen companies, announced this week that he has raised another $30 million to launch a startup that embodies his latest vision—Integrated Diagnostics. This company will seek to develop instruments that can detect cancer and Alzheimer’s disease by looking at concentrations of proteins from a tiny droplet of blood.

—Seattle-based Omeros (NASDAQ: OMER) pulled off the first IPO of a true biotech company anywhere in the U.S. since February 2008. The company netted about $62 million, part of which will go to support pivotal trials of its treatment to help improve recovery from knee surgery. But other biotechs watching this as a bellwether have to be a little concerned after seeing Omeros price its offering at $10 a share, the low end of its forecasted range. The stock has been heading downhill ever since it started trading, to $7.44 at yesterday’s close.

—Chris Henney, the co-founder of Immunex, Icos, and Dendreon, offered up a very entertaining list of six tips for investors on how to spot a winning biotech company. He made these remarks at a luncheon event organized by the CFA Society in Seattle, in front of about 100 investing professionals.

—Medical device startups are feeling a lot of pain this year, for a lot of reasons, and it was all laid bare this week in a sobering report by Ernst & Young.

—One of the more fortunate medical device companies in Seattle, Uptake Medical, secured an additional $1.2 million in equity financing, meaning it has now raised $4.6 million out of a venture round that could be worth as much as $13.3 million. The company is developing a minimally invasive technique for treating chronic lung diseases by using hot vapor to seal off damaged parts of the lung so air doesn’t get trapped there.

—Lots of people are wondering whether Roche will retain most of the talent at Genentech in the wake of its acquisition this spring. Bothell, WA-based Seattle Genetics (NASDAQ: SGEN) pried loose at least one important player from the industry’s pioneering company, naming Bruce Seeley to the newly created position of executive vice president, commercial, with responsibility for future sales and marketing. Seattle Genetics will lean on him to spearhead what it hopes will be a successful commercial rollout of its “empowered antibody” for Hodgkin’s disease.

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Seattle Genetics, the Bothell, WA-based developer of targeted antibody drugs for cancer, said today it has hired its first head of commercial operations to prepare for the introduction of what it hopes will be its first marketed product. The company (NASDAQ: SGEN) said it hired Bruce Seeley for the new position of executive vice president, commercial. Seeley will be responsible for building up the sales and marketing teams to support brentuximab vedotin, which the company expects to the U.S. market by late 2011. Seeley previously worked at Genentech as senior director for marketing of trastuzumab (Herceptin) and TDM1.

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Seattle’s biotechnology industry is in significantly better financial shape than it was six months ago. The turnaround has been nothing short of amazing, thanks to a frantic run of dealmaking, cost-cutting, and remarkable clinical trial results that have made local companies some of the best-performing stocks this year on the NASDAQ.

Indeed, while our first analysis of the Northwest’s public life sciences companies, published last November, showed that six of 10 companies had less than a year’s worth of cash on hand at that point, only one—Seattle-based Northstar Neuroscience—actually folded.

And when we took a look at the most recent quarterly reports filed with the Securities and Exchange Commission by the 12 companies we’re following right now (11 of them public, one preparing for its IPO), we found that seven of them were actually in a stronger position at the end of June than they were at the start of the year. What’s more, three of the companies that were classified by this analysis as worse off (Seattle-based Trubion Pharmaceuticals and Targeted Genetics and Bothell, WA-based OncoGenex Pharmaceuticals) have recently struck partnerships or completed financings that aren’t yet reflected in the federal filings, but have clearly improved their financial futures.

Read on for a complete rundown of all 12 companies, listed in alphabetical order. To purchase a much expanded version of this report, in PDF format, click the “Add to Cart” button below. The expanded version, available for $95,* includes an assessment of each company’s financial position at the end of June compared to six months earlier, the projected length of time it can survive on its existing cash reserves, and an analysis of the strategic moves it has made to stay afloat in the current environment. Click here to see a sample entry. *Price is subject to change without notice.

We intend to repeat this analysis regularly to monitor the financial health of the life sciences companies we follow in San Diego, Seattle, and Boston. Please send feedback to editors@xconomy.com.

AVI Biopharma (NASDAQ: AVII)
Cash on hand: $20.2 million
Related Xconomy coverage:
“AVI Biopharma Bolts from Portland to Seattle to Tap Biotech Talent”
“AVI Biopharma Out to Reinvent Itself, Making RNA-based Drugs for Ebola and Other Nasty Things”
“Ebola Fighter AVI Biopharma Gears Up for Biodefense Contracts”

Cell Therapeutics (NASDAQ: CTIC)
Cash on hand: $12 million
Related Xconomy coverage:
“Cell Therapeutics Teeters on the Brink as Cash Runs Out on Promising Cancer Drugs”
“Cell Therapeutics Taps Stock Market Again, Seeks $40M or More”
“Cell Therapeutics Files Cancer Drug Application, In Nick of Time”
“Cell Therapeutics Lymphoma Drug Boosts Remissions, Shares Boom”
“Cell Therapeutics Reports Severe Cardiac Events in Drug Trial”
…Next Page »

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Ambrx has ginned up yet another potentially lucrative Big Pharma deal. The San Diego-based biotech company has struck a worldwide partnership with Madison, NJ-based Wyeth to create new engineered antibody drugs against multiple diseases.

Financial terms aren’t being disclosed, but Ambrx says it is raking in an upfront payment, research funding, milestone payments based on progress developing drug candidates, as well as royalties on sales of work that translates into marketed products. This deal, combined with Ambrx’s partnerships with three other major drugmakers, means that Ambrx now has enough cash in the bank to operate “multiple years” without seeking additional financing, according to CEO Steve Kaldor.

“We have no lack of interest in the company,” says Kaldor, who adds that he had talks with five different prospective partners before settling on Wyeth in the latest alliance. “We’ve actually been turning down deals.”

The Ambrx story began back in 2003. That’s when Peter Schultz, director of the Genomics Institute of the Novartis Research Foundation (and the founder of eight biotech companies) had a new idea for creating new amino acid building blocks for a different class of biotech drugs. These drugs could potentially do whatever you wanted, like last longer in the body, or carry potent cell-killing agents. That work has enabled Ambrx to raise about $106 million in venture capital, build a scientific team of about 80 people, and score five different partnerships with three other major drugmakers to date—Merck, Eli Lilly, and Merck KGaA of Germany.

Ambrx’s two best-known drug candidates are designed to be longer-lasting versions of protein drugs that treat growth deficiencies and multiple sclerosis. But Wyeth, a major drug maker that’s in the process of being acquired by Pfizer (NYSE: PFE), was interested in something new that emerged at Ambrx …Next Page »

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Biotech companies run into walls all the time, and either reinvent themselves or die. If they’re fortunate, they get one shot at a turnaround. San Diego-based Ambit Biosciences is getting a third chance, and this time it has some hard data, not just a flashy concept, to offer.

Ambit got started in May 2000, just when the bubble was starting to pop on the Internet and genomics stock bubbles. Ambit’s original plan was to take some technology out of Yale University to build a database of all the proteins in the body and sell the information to drug companies.

When that business model fell out of favor just seven months later, Ambit re-started around the idea of screening ideal drug candidates against certain protein targets. Two multi-billion dollar drugs for diabetes and neurological conditions, metformin and gabapentin, were losing patent protection, and Ambit thought it could develop more effective second-generation treatments if it could discover how they really interacted with protein targets. It raised $20 million on that effort in 2001 and 2002, before it flamed out the next year.

“At the end of the second incarnation, we had nothing. It didn’t work,” says Scott Salka, Ambit’s CEO. “We had two strikes against us, we were standing at the plate, and had hardly any money. We could fold up our tent and go home, or salvage something.”

Ambit’s next chance came with an emerging class of drugs known as kinase inhibitors. They have been a hot area for prospective cancer drugs over the past decade, and block certain enzymes called kinases. Novartis’ imatinib (Gleevec) achieved breakthrough status (and multi-billion-dollar sales) as an inhibitor of a very specific kinase involved in chronic myeloid leukemia. Other pioneering kinase inhibitors, like Pfizer’s sunitinib (Sutent) appeared to work well against kidney cancer even though it blocked several variations in the family of kinases. That stirred debate about whether it was better to be more selective to certain targets, or less, in developing new compounds. That created demand among drug companies to do in-depth selectivity studies, Salka says. As a result, drug companies lined up for services from Ambit, which could screen large numbers of kinases for the best possible drug to block them.

That core skill of Ambit’s was good enough to win support from Roche, Bristol-Myers Squibb, GlaxoSmithKline, Pfizer, Johnson & Johnson, and Cephalon, and has provided some cash to keep the doors open of a fledgling biotech company for nine years. It’s also enabled Ambit to raise a total of $105 million from a list of investors that now stretches 14 deep.

But just like genomics was the hot new thing that faded in 2000, it’s hard to get investors excited about a biotech business that collects fees for services from Big Pharma. The big potential, as always, is in developing new drugs for deadly diseases.

While Ambit was screening kinases for Big Pharma customers, it was also building up a portfolio of kinase drug candidates of its own. The company’s lead asset of the moment is AC220 for acute myeloid leukemia. It’s a malignancy that strikes 13,000 people each year in the U.S., mostly elderly, who have a short life expectancy and no realistic treatment options beyond chemotherapy. With little notice, Ambit is gearing up this month to start a pivotal clinical trial of this product and is even in partnership talks. If this drug can match striking results seen in an earlier study, then Ambit could have this product on the market by the first half of 2011, Salka says.

“It’s a great story for San Diego biotech,” Salka says. “Hopefully we can deliver the goods.”

Ambit drew some attention for its drug last December at the American Society of Hematology meeting in San Francisco. That was where researchers reported that 16 of the first 54 patients with relapsed forms of acute myeloid leukemia had tumor shrinkage …Next Page »

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There were some striking highs and lows in Seattle biotech this week.

—Seattle-based Targeted Genetics (NASDAQ: TGEN), the stalwart of gene therapy, needed a lifeline if it was going to survive any longer, and it got one at the last minute this week from Cambridge, MA-based biotech giant Genzyme (NASDAQ: GENZ). Targeted is handing over some intellectual property on gene therapy manufacturing for $7 million—enough to keep the doors open through 2010.

—Many biotechs have been known to overhype groundbreaking new therapies, but this week the SEC charged one Seattle-area company with crossing the line into investor fraud. The SEC leveled the charges against Bothell, WA-based CellCyte Genetics, and its former executives.

—The guys who created the Sonicare toothbrush have another hit on their hands with the Clarisonic. This is a $195 device that uses sonic wave technology as a new way of skin cleansing. Clarisonic, led by entrepreneur David Giuliani, topped $40 million in sales last year, has grown to 150 employees, and is turning consistent annual profits, he says.

—Seattle-based Theraclone Sciences and its collaborators made international headlines with the discovery of two antibodies with broad ability to neutralize HIV. This groundbreaking work helped Theraclone pick up some precious funding for its research from the International AIDS Vaccine Initiative.

—Seattle-based Trubion Pharmaceuticals (NASDAQ: TRBN) struck a deal last month with Redwood City, CA-based Facet Biotech (NASDAQ: FACT). But one of the world’s biggest biotech companies, Cambridge, MA-based Biogen Idec, which was looking to take over Facet, said in a statement it didn’t like the new deal with Trubion. Biogen is now mounting a hostile takeover bid for Facet.

—Seattle Genetics (NASDAQ: SGEN), the Bothell, WA-based developer of antibody drugs for cancer, said this week it achieved a milestone with Bayer Schering Pharma AG, one of the companies that has bought a license to its technology for linking antibodies to toxins that can make them more potent.

—Complete Genomics, the Mountain View, CA-based company that has a goal of sequencing entire human genomes for $5,000, said it has completed 14 full genomes for customers since March. Kirkland, WA-based OVP Venture Partners is one of the founding investors in this company.

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Seattle Genetics (NASDAQ: SGEN) said today that it achieved a milestone under its partnership with Bayer Schering Pharma AG of Germany. The Bothell, WA-based company provided Bayer with a license to its technology for linking antibodies to toxins, with a goal of making targeted and potent anti-cancer drugs. Bayer has now submitted an application to the FDA to start a clinical trial of a drug using the technology, Seattle Genetics said. Financial terms of the agreement weren’t disclosed.

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We’re supposed to be oh-so-laid-back here in the Northwest, so the surprise of the week came when one of the local biotech mainstays showed it was willing to step up and punch a competitor in the nose.

—Seattle-based ZymoGenetics (NASDAQ: ZGEN) showed it was willing to ruffle some feathers in its quest to gain market share for its sole marketed product, recombinant thrombin (Recothrom) for surgical bleeding. The company asked the FDA to pull a competing product from Bristol, TN-based King Pharmaceuticals (NYSE: KG) off the market, citing two deaths attributed to the product.

—Targeted Genetics (NASDAQ: TGEN) only has enough cash to operate through this month, so these could be the final days for this 17-year veteran of the Seattle biotech scene. It never cured anything, but this company is leaving a legacy, with a generation of biotechies making an impact at other local companies. I’ve pulled together a list of 60 Targeted Genetics alumni at last count. If you know of someone I’ve overlooked, please add a comment at the bottom of the story or send me an e-mail at ltimmerman@xconomy.com.

—Seattle-based Omeros is preparing to make a renewed attempt at an IPO, possibly as soon as next month, according to this story we broke on Xconomy yesterday. The IPO market is expected to open up again in the middle of September, because institutional investors like the caliber of companies in the IPO queue, and the bargain prices, says Cascadia Capital CEO Michael Butler.

—Speaking of the IPO market, Kirkland, WA-based OVP Venture Partners sees IPO potential in one of the most flush members of its portfolio, Mountain View, CA-based Complete Genomics. This is the company that’s on a quest to introduce full human genome sequencing for as little as $5,000. OVP joined a syndicate this week that pumped in another $45 million to help the company get its commercial sequencing facility up to full capacity.

—Seattle Genetics has been saying it’s six months ahead of schedule in enrolling patients in the pivotal trial of its drug for Hodgkin’s disease, and this week the Bothell, WA-based company (NASDAQ: [[ticker:SGEN]) made it official. It completed enrollment in the trial, and expects results in the second half of 2010.

—Seattle-based Cell Therapeutics (NASDAQ: CTIC) said the FDA has agreed to review its application to market pixantrone for non-Hodgkin’s lymphoma. The company still hasn’t heard from the FDA on when the review should be completed, although it expects to be informed of the deadline by Sept. 4.

—AVI Biopharma, the developer of RNA-based drugs that moved its headquarters from Portland, OR to Bothell, WA, loaded up its balance sheet this week with more cash. The company (NASDAQ: AVII) ended up pulling in $34 million through selling common stock and warrants.

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[Updated: 4:30 pm Sept. 11 with one new name]

Targeted Genetics never cured anything. The Seattle biotech company (NASDAQ: TGEN) didn’t prove the concept that gene therapy could usher in a new era of more effective medicines. It was never profitable. It burned through more than $315 million in investor capital during its 17-year history.

Those are cold facts that can’t be ignored as Targeted Genetics takes in what appear to be its dying breaths, as it says it needs new capital to operate beyond this month. But what will its legacy be on the Seattle biotech landscape? One of the clear answers is this: people.

It all started with H. Stewart Parker, the founder and longtime CEO, whose roots in biotech go back to her days as the first employee at Seattle-based Immunex in 1981. She learned the industry ropes there, climbed the ladder, and spun off that company’s gene therapy research into Targeted Genetics in 1992. She recruited, inspired, and mentored a generation of biotechies who have moved on to make important contributions at other organizations across the Northwest. It’s not going out on a limb to say these people, and others they will train in the future, will continue to make an impact on the local industry for years.

“People literally slept on the floor sometimes, I can remember, in the middle of manufacturing campaigns,” says David Schubert, president of Seattle-based Accelerator, who worked at Targeted Genetics from 1997 to 2000. “People there were incredibly committed and felt a great sense of camaraderie. It was an amazing training ground for talented people.”

Some Targeted Genetics alumni have left for jobs in other parts of the country, but here is a list of notable names in alphabetical order who remain active in Seattle biotech, which I’ve put together with help from Parker and Schubert, and from other readers. This list certainly isn’t comprehensive, so if you can think of former Targeted people who are making an impact in Seattle biotech who I’ve overlooked, please send me an e-mail at ltimmerman@xconomy.com. Or feel free to post a comment at the bottom of the story:

—Tara Allen, clinical research associate, Dendreon

—Todd Allen, Technical Operations at ZymoGenetics

—Kevin Anderson, scientist, Seattle Genetics

—Rema Assaf, senior project manager, Seattle Genetics

—Emma Austin, document control specialist, ZymoGenetics

—Susan Bell, research associate, MDRNA

—Emily Bradeen-Duncan, manufacturing quality assurance associate, Seattle Genetics

—Stacie Byars, director of marketing and membership, WBBA

—Barrie Carter, consultant, president-elect of the American Society of Gene and Cell Therapy

—Victoria Cleator, biotech facilities expert, Seattle Children’s Hospital

—Holly Craven, quality control analyst, ZymoGenetics

—Richard Daifuku, consultant, founder of Redmond, WA-based Koronis Pharmaceuticals

—Daryn Debelak, Northwest account manager for Invitrogen

—Devon DeHaas, Seattle account manager, VWR International
…Next Page »

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Seattle Genetics, the Bothell, WA-based developer of cancer drugs, said today that it has completed enrollment in the pivotal clinical trial of its lead product candidate, brentuxmab vedotin (SGN-35). The trial recruited 100 patients with relapsed forms of Hodgkin’s disease. The enrollment period was about six months faster than the company expected, so Seattle Genetics expects to have results from the trial sooner as well, by the second half of 2010. The speed of the enrollment helped Seattle Genetics raise $136 million in a stock offering, as we described in this recent feature story.

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Somebody forgot to tell the Northwest biotech community this is the height of vacation season. Our pages this week were packed with stories on financings, clinical trials, exclusive interviews and more.

—Rick Klausner, the former leader of the National Cancer Institute and the global health wing of the Bill & Melinda Gates Foundation, provided some intriguing insights on cutting-edge biology that he’s been following in his new job as a venture capitalist. Deep into this story, Klausner explains why he thinks Seattle-based Dendreon (NASDAQ: DNDN) is just scratching the surface of what immune-stimulating therapies will be able to do in the future.

—Targeted Growth gets its share of publicity for its camelina seeds that are used to make jet fuel, but further in the future, Targeted Growth envisions making a bigger impact with genetically modified algae that can be made to compete on price with petroleum. We got the story from a conversation with Targeted Growth’s Margaret McCormick.

—Seattle-based Cell Therapeutics (NASDAQ: CTIC) raised about $40 million last month, and lo and behold, this week it found yet another lone institutional investor willing to wager another $30 million that this company has brighter days ahead. Cell Therapeutics has asked the FDA to approve its experimental pixantrone therapy for patients with non-Hodgkin’s lymphoma.

—PATH, the Seattle-based nonprofit that works to improve health in poor countries, won the closest thing the humanitarian field has to the Nobel—the Conrad N. Hilton Humanitarian Prize. PATH president Chris Elias envisions using the $1.5 million cash award as seed capital for a five-year, $25 million plan to support innovative new global health technologies, and to support geographic expansion in Africa.

—Amgen scientists in Seattle had something to celebrate a week ago, but just one week later the picture has gotten a little muddier. Earlier, we reported that the first big prospective clinical trial confirmed the company’s hypothesis that panitumumab (Vectibix) can slow the spread of tumors for colorectal cancer patients with normal forms of the KRAS gene (and that the drug doesn’t help those with mutated forms). This week a second clinical trial in a sicker patient population found the same pattern with respect to slowing the spread of tumors, although the treatment didn’t actually help normal KRAS patients live any longer.

—Seattle Genetics put the finishing touches on its big stock offering, which ended up generating a grand total of $136 million. The Bothell, WA-based developer of cancer drugs (NASDAQ: SGEN) said its underwriters exercised all their options to buy an extra 1.65 million shares. JP Morgan and Goldman Sachs were joint book-running managers of the offering. (Apparently Seattle Genetics saw fit to use at least a little money to spiff up its website, too.)

—Seattle-based biotech consultant Stewart Lyman submitted another intriguing editorial for the Xconomist Forum on why Big Pharma companies have many reasons to make biologic drugs. Some of this is about science, but there’s politics and business to consider, too.

—Mukilteo, WA-based CombiMatrix (NASDAQ: CBMX), the maker of genetic analysis tools, is looking to hire an investment bank to consider whether the time is right to sell the company. Back in June, after it got crushed by bigger competitors selling DNA microarray tools, I profiled the company’s attempt to reinvent itself around cancer diagnostics.

— Light Sciences Oncology isn’t just about oncology anymore. The Bellevue, WA-based company said it has started enrolling patients in a clinical trial to see if it can treat benign prostatic hyperplasia, otherwise known as an enlarged prostate. The company’s technology uses light-emitting diodes, threaded into localized tissue, to activate a drug within a certain wavelength.

—Seattle-based Sound Pharmaceuticals, the developer of treatments for hearing loss, said this week it nailed down a $2.1 million contract from the U.S. Navy to continue developing its lead therapy. It’s the third grant the company has gotten from the Navy since 2005, and will enable it to beef up its pipeline of experimental treatments, says CEO Jonathan Kil.

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It was a crazy busy week for deals in the Northwest. Just when we thought the flow might slow down before the end of summer, we saw tons of activity in software, Internet, mobile, gaming, and materials.

—Bellevue, WA-based Apptio, the IT cost management startup led by CEO Sunny Gupta, raised $14 million in Series B funding from Madrona Venture Group, Greylock Partners, Shasta Ventures, and the Andreessen Horowitz Fund. The money will allow Apptio to aggressively expand its sales and product development. Gupta also had some telling things to say about his company’s culture.

—Seattle-based Impinj has teamed up with Coca-Cola to provide radio frequency identification tags and readers for the soda giant’s new Freestyle drink dispensers. Financial terms were not given. The Impinj technology will allow Coke to track and monitor its dispenser operations and customer preferences in real time.

—Hillsboro, OR-based AISI, maker of a testing system for semiconductor memory manufacturing, closed a Series B financing round worth $11 million, as Eric reported. Investors in this round included OVP Venture Partners, TL Ventures, and Intel Capital.

—Seattle and San Francisco-based Jambool raised $5 million in venture funding, led by Madrona Venture Group. Bay Partners also participated in the financing round. Jambool has developed a micropayments and virtual currency system for social online games.

—Vancouver, WA-based ClearAccess raised about $6 million in Series B funding from Blade Ventures, Buerk Dale Victor, and DFJ Frontier, as Eric reported. ClearAccess provides data services and broadband device management for Internet service providers.

—Kirkland, WA-based OVP Venture Partners led a $14 million Series B financing round for Boston-based Novomer, a green materials startup, as Wade reported. Physic Venture Partners, Flagship Venture Partners, and DSM Venturing also participated in the round.

—Seattle-based iLike is rumored to be bought by MySpace for some $20 million, as Eric reported. The deal could close by the end of this week. Founded in 2002, iLike is an Internet music company that helps people find new music and concerts and create playlists.

—Seattle-based NewPath Networks, a provider of wireless carrier network technologies, announced a new $10 million line of credit from Square 1 Bank. Back in April, NewPath raised $30 million from New York-based Charterhouse Group and Denver-based Meritage Funds. NewPath designs and operates antenna systems for wireless networks.

—Seattle Genetics (NASDAQ: SGEN), a Bothell, WA-based developer of antibody drugs for cancer, raised $136 million in a stock sale, as Luke reported. JP Morgan and Goldman Sachs led the offering. Seattle Genetics is six months ahead of schedule in a pivotal study of its experimental drug for Hodgkin’s disease.

—Seattle-based Z2Live, a mobile social games startup, has raised $3 million from Madrona Venture Group, according to a report in TechCrunch. Z2Live has developed a free, multiplayer platform for social and casual games on the iPhone and iPod Touch.

—Microsoft (NASDAQ: MSFT) and Nokia (NYSE: NOK) announced an alliance that will create adaptations of Microsoft programs, like Office, for Nokia smartphones. Financial terms weren’t given, but the two companies will jointly market the products they create together. Nokia’s Symbian mobile operating system has been a major competitor to Microsoft’s Windows Mobile platform.

—Lastly, we provided some more in-depth analysis of Microsoft’s sale of Seattle-based Razorfish to Publicis for $530 million, from Cascadia Capital’s Warren Gouk, an expert on mergers and Internet strategy. Gouk said Microsoft stands to gain a lot if the deal drives its search and display advertising business, while Razorfish could expand its international market.

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Seattle Genetics, the Bothell, WA-based developer of antibody drugs for cancer, said today that underwriters of its stock offering have exercised their options to buy more shares, which makes the deal worth a total of $136 million. JP Morgan and Goldman Sachs led the offering, which also included Needham & Co., Oppenheimer & Co., RBC Capital Markets, and William Blair & Co. The company, as we described in a feature story earlier this week, has attracted interest partly because it is six months ahead of schedule in the pivotal study of its experimental drug for Hodgkin’s disease.

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Quite a few publicly traded biotechs released quarterly financial statements this week, but we arranged some fascinating conversations with entrepreneurs and researchers to offset the necessary number-crunching.

—Seattle Genetics is having a breakout year, and one sure sign is that it has enrolled cancer patients in a clinical trial much faster than the industry norm. That was one big reason why the Bothell, WA-based biotech company (NASDAQ: SGEN) was able to sell 11 million new shares to investors this week, in an offering that raised a cool $118 million. Usually these offerings dilute the value of existing shares and drive down the stock price, but Seattle Genetics actually climbed 5 percent the following day.

—Amgen has spent five years researching biomarkers that might provide clues as to which cancer patients will respond to a drug, and which won’t. Much of the “personalized medicine” work, performed at research centers in Seattle and Cambridge, MA, was validated last week in the first big prospective clinical that showed patients with a normal form of the KRAS gene were more likely to benefit from taking panitumuab (Vectibix) than those with a mutated form.

—I had a fascinating conversation this week with Bonnie Ramsey, one of the world leaders in research and treatment of cystic fibrosis. Ramsey, who’s affiliated with Seattle Children’s Hospital and the University of Washington, talked in great depth about the surprising extent to which research has improved the outlook for CF patients over the past 30 years, and the significance of an emerging treatment from Cambridge, MA-based Vertex Pharmaceuticals (NASDAQ: VRTX).

—Stephen Friend is best known in Seattle as the founder of Rosetta Inpharmatics, and now he’s back in Seattle, dreaming big again. Friend described his vision, and progress during the early days, at the nonprofit genomics collaborative he’s leading called Sage Bionetworks.

—We published a couple of guest editorials this week that are of interest to biotechies. The first was from Jim Thomas, a vice president at Amgen in Seattle, on how he says lawmakers can provide a way for “biosimilars” to enter the marketplace without undermining incentives for companies like his to develop innovative new medicines. The next piece on national policy was from Ryo Kubota, CEO of Bothell, WA-based Acucela, who advised policymakers not to reform healthcare in any way that dampens the entrepreneurial spirit that makes America the best place for developing new drugs.

—Seattle-based Dendreon is starting to branch out across the U.S. map. The company (NASDAQ: DNDN) confirmed this week that it is planning to add two new manufacturing plants for its prostate cancer drug, sipuleucel-T (Provenge) in the greater Atlanta area, and in Orange County, CA. The company also reported that it had $287 million in cash and investments when the second quarter ended on June 30, helped along by a $227 million infusion it got from investors after Provenge passed its pivotal clinical trial in April.

—AVI Biopharma, the RNA-based drug developer that’s moving its headquarters from Portland, OR, to Bothell, WA, said it ended the second quarter with $20 million in cash. AVI (NASDAQ: AVII) has been strengthening its financial position for months, and predicted that it will pull together more funding this year from governments and other sources.

—Seattle-based Oncothyreon (NASDAQ: ONTY) said it ended June with $22.7 million in cash, which—hold on here for a double-take—was actually $3.5 million more than it had at the beginning of the year. The company has fattened up its balance sheet with another $14 million through a stock offering this month, giving it more breathing room in its quest to develop cancer drugs.

—The financial prospects looked a lot dimmer this week for Seattle-based Targeted Genetics (NASDAQ: TGEN). The gene therapy stalwart, which has been warning of its possible demise since May, said this week that it “must raise additional capital” if it is going to remain in business beyond the end of this month.

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Drug companies usually have a hard time recruiting cancer patients in clinical trials, and some dirty little financial reasons for it were exposed last week in The New York Times. Another little secret is that biotech companies often overpromise, and under deliver, when they tell investors they will hit their clinical trial deadlines.

That makes it all the more surprising to hear what’s going on at Bothell, WA-based Seattle Genetics (NASDAQ:SGEN). This company, the developer of an “empowered antibody” against Hodgkin’s disease, said recently its pivotal study is recruiting patients so fast that it is now six months ahead of schedule. That sets off a chain reaction that means it should have results sooner, apply for FDA approval quicker, and reach the market six months earlier, possibly as soon as the end of 2011.

Seattle Genetics has been able to pull this off because of pent-up demand from very sick patients with relapsed forms of Hodgkin’s disease, who are searching for new treatment options. Top cancer doctors hopped on the bandwagon after the American Society of Clinical Oncology meeting in June 2008, when the company released preliminary results showing its experimental treatment was able to completely wipe out or partially shrink tumors for 12 of 38 patients, with mild to moderate fatigue, cough, and nausea as side effects. The preliminary results for brentuximab vedotin (formerly known as SGN-35) started looking even better when longer-term follow-up data was presented at a medical meeting in December.

“More investigators wanted into the trial than we could really let in to participate,” said Tom Reynolds, the chief medical officer at Seattle Genetics, in an interview on Aug. 3. “You usually have to work really hard to get them interested. There seems to be a good buzz going in the oncology community.”

Investors like it too. JP Morgan analyst Cory Kasimov, a Seattle Genetics bull, headlined his note to investors on July 23 with “SGN-35 Momentum Continues to Pick Up Steam.”  Seattle Genetics seized on some of that momentum this week, raising $118 million in a stock offering that priced yesterday afternoon.

Exciting as it all was, drug development is highly regulated and slow. But Seattle Genetics has been pushing hard to move as quickly as possible. One month after producing that stellar data at the American Society of Hematology in December, Seattle Genetics clinched an agreement with the FDA on …Next Page »

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Seattle Genetics (NASDAQ: SGEN) announced today that it will be selling 11 million shares of common stock in an underwritten public offering for $10.75 a share. This is expected to raise about $118.2 million for the Bothell, WA-based developer of antibody cancer drugs. The offering is expected to close by Monday. Seattle Genetics’ stock price was $10.99 at market closing Tuesday, so the new offering gives buyers approximately two percent in savings.

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Seattle Genetics, the Bothell, WA-based developer of antibody drugs for cancer, said today it has earned an undisclosed milestone payment from MedImmune, a wholly-owned subsidiary of AstraZeneca. Seattle Genetics (NASDAQ: SGEN) is due to receive the payment because MedImmune started a clinical trial with a drug that uses Seattle Genetics’ proprietary technology for making antibody treatments more potent. Seattle Genetics has also licensed the technology to Genentech, Millennium: The Takeda Oncology Company, and Bayer, among others.

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Seattle Genetics, the Bothell, WA-based developer of targeted antibody drugs, said today it has started a mid-stage clinical trial of SGN-35 as a treatment for relapsed forms of anaplastic large cell lymphoma. The trial will enroll 55 patients, who will the same dose every three weeks as the one being used in an ongoing pivotal trial of Hodgkin’s disease and related lymphomas. The Seattle Genetics (NASDAQ: SGEN) drug is designed to be an “empowered antibody” that adds a potent toxin to an antibody to give it more tumor-killing punch.

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