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With assets of barely more than $18,000 and liabilities of more $10 million, Waltham-based biotech startup Dynogen Pharmaceuticals Inc. is calling it quits.
This past week, the developer of a treatment for irritable bowel syndrome and digestive disorders, filed for Chapter 7 bankruptcy protection in federal court. The company’s main phone number was already disconnected as of Wednesday, and its website was listed as under construction.
The move caps a roughly seven-year run. The firm was founded in 2002 and had raised $67 million in venture capital. As of February 2008, it had two drugs for irritable bowel syndrome on track to enter Phase 3 clinical trials and was slated to hold an initial public offering. It intended to accomplish that through a reverse merger with publicly traded Apex Bioventures Acquisition Corp. of California. This move, Dynogen claimed at the time, would have left it with $65 million in cash after closing the deal to fund late clinical trials and drug research. The Apex deal, however, fell through in April.
Then, in June, Dynogen said it planned to raise more than $30 million in private financing. Now the company is slated for liquidation. Almost $15,000 of the company’s $18,392 in assets consists of office furniture and supplies, according to documents.
A number of local firms had ownership stakes in Dynogen, according to court documents. Those companies include Healthcare Ventures of Cambridge, which owned approximately 20 percent of the firm and was a managing partner and a preferred stock investor. Similarly, Oxford Bioscience Partners LP, based in Waltham, also was a preferred stock investor and had a 20 percent ownership claim. Jonathan Fleming, managing general partner at Oxford, declined to comment on the bankruptcy.
Atlas Venture of Waltham, a preferred stock investor, had a 9 percent ownership claim. Atlas also did not return requests for comment. Abingworth Management of Waltham was both a partner and had an 11 percent ownership.
Dynogen’s listed liabilities include $6.5 million in secured claims and $1.1 million in unsecured priority claims, as well as $3 million in unsecured nonpriority claims. The $6.5 million in secured claims are divided among Arachnova Therapeutics Ltd. with $1.5 million, Silicon Valley Bank with $2.5 million, and Oxford Finance Corp. with $2.5 million. The majority of Dynogen’s $1.1 million in unsecured claims relate to employee severance packages.
Boston-based law firm Mintz, Levin, Cohn, Ferris, Glovsky and Popeo PC is representing Dynogen in the bankruptcy proceedings.
$10.6M
Amount of Dynogen’s liabilities that include $6.5 million in secured claims, $1.1 million in unsecured priority claims, as well as $3 million in unsecured nonpriority claims.
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