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Taris 2.0: A Year After Buyout, VCs Bet $32M More on a Second Strike

Xconomy Boston — 

It’s hard enough to successfully create and sell a biotech company, let alone strike gold twice or more on the same group of assets. But that’s the type of thing Taris Biomedical and its venture backers are shooting for, a year after selling one of the company’s programs to Irvine, CA-based Allergan (NYSE: AGN).

In August 2014, Allergan agreed to pay $67.5 million—and potentially as much as $587.5 million—for Taris’s lead program, a drug-device treatment for what’s known as interstitial cystitis, or painful bladder syndrome.

Taris, a Lexington, MA-based startup from the labs of MIT’s Bob Langer and Michael Cima, held some assets and intellectual property out of the deal. Taris CEO Purnanand Sarma funneled the technology into a new spinout—a Taris 2.0, if you will, and Sarma remained at the helm.

Today, that company has raised $32 million in financing from some of the same firms that cashed out on Taris the first time around, Flagship Ventures and Polaris Partners. RA Capital Management is also now in the mix, helping fund the development of a pipeline of treatments Taris is developing for a variety of diseases affecting the bladder—like bladder cancer and overactive bladder.

The original Taris was formed with the help of Flagship, Flybridge Capital Partners, and Polaris in 2009, based on an implantable device that can release a controlled dose of a drug into the bladder. That’s important, because it’s difficult to effectively deliver drugs to the bladder with pills or injections/infusions. Pills, for instance, have to travel to the bladder and can cause side effects along the way. Taris believes administration of a controlled dose through its device can lead to more effective therapy, without those side effects.

The device itself is a thin flexible silicone tube implanted via a catheter that springs out into a little pretzel shape once inside the body. The device then continuously releases a drug over the course of weeks or months. Taris called the first iteration of this technology “LiRIS”—it releases the common anesthetic lidocaine into the body over a few weeks, and Taris was testing it for painful bladder syndrome. (Sarma says Taris hasn’t encountered any significant safety problems associated with the device in its trials as of yet.)

Allergan stepped in and bought the product while it was in Phase 2 trials, and has taken it forward. Sarma said all the upfront cash went to Taris’s shareholders, recouping the roughly $50 million they initially invested in Taris and then some. He wouldn’t say what the status of the LiRIS program is, or whether it’s hit any additional milestones, but according to clinicaltrials.gov, there are two studies underway that are expected to wrap up in 2017.

Sarma says just before doing the Allergan deal, Taris structured itself as a limited liability company, or holding company. That was so Taris could more easily hive off an asset—the LiRIS program—and keep ahold of everything else, like the rights to use its technology for other bladder-related problems. That meant Taris would have the flexibility to sell off other programs, and generate more cash for its shareholers.

“We believed at that point that going broader was more value-creating for us, rather than holding onto one asset and [moving] it forward,” Sarma says.

Taris spent some time transitioning the LiRIS program over to Allergan, and tried to find where else its technology might have some use. It’s decided on two areas so far. The first is bladder cancer, which affects about 60 million in the U.S. Sarma says the idea would be to deliver doses of certain anti-cancer drugs through the same device. He wouldn’t reveal which drug Taris will use, just that it’s already off patent and free to Taris to test. The second potential area is overactive bladder, which can lead to sudden urges to urinate and incontinence. Again, Taris is taking a drug already used to treat the condition, but at a much smaller dose that is delivered directly to the bladder via its device.

Taris expects to put four programs into clinical testing next year, with results coming late in the year. If those studies are successful? Perhaps Taris and it’s backers will try to cash out on one of those programs too. “We could do Allergan-like transactions again and again,” Sarma says.

Though this kind of strategy isn’t the norm, there have been other recent examples of biotechs to sell some—not all—of their assets, and then get backing for a sequel. Some others include: San Diego’s Aragon Pharmaceuticals and its successor Seragon Pharmaceuticals, both of which were sold roughly a year apart; Flexus Biosciences, which was sold, but kept some assets behind for an as of yet unnamed follow-on company; and iPerian, which sold some assets and funneled other work into True North Therapeutics. (For more, check out this column from Alex Lash.)

Kevin Finney, Allergan’s head of corporate development, has joined Taris’s board of directors as part of the financing. Mark Iwicki, formerly the president and CEO of Civitas Therapeutics, has also joined Taris’s board. Others on the board include Dennis Ausiello of Massachusetts General Hospital, Kevin Bitterman of Polaris, Ed Kania of Flagship, and Rajeev Shah of RA Capital. Christopher Cutie, a global medical advisor to Tokai Pharmaceuticals, has been named Taris’s head of clinical development.