Wednesday, January 5, 2011

Genocea's $35M VC round pushing herpes vaccine toward clinic

By Lori Valigra, Mass High Tech correspondent

At first glance, Cambridge-based Genocea Biosciences Inc. seems to lack some key ingredients for attracting follow-on venture funding, namely a CEO, a product in the clinic and licensees. However, that didn’t deter nine venture capitalists, including three new ones, from investing $35 million in a Series B round earlier this week.

“That didn’t bother us,” said new investor Stephen J. Hoffman of the company not having a CEO. “We went into this investment knowing that. And now we are part of the recruitment process. There are a number of very exceptional candidates under consideration.” Hoffman is managing director at Skyline Ventures in Boston, and joined the Genocea board in connection with the financing. He also serves as chairman of Westminster, Colo.-based Allos Therapeutics Inc. and a director of Cambridge-based Sirtris Pharmaceuticals Inc., and was previously a general partner at TVM Capital.

“There are a lot of biotech and venture veterans on the board. That combination will not let the company go astray in the meantime,” said Chip Clark, chief business officer at Genocea. He added that the company hopes to have a CEO within a couple months. Prior to joining Genocea, Clark was chief business officer at Rockville, Md.-based Vanda Pharmaceutical Inc., where he helped secure more than $220 million in funding and landed a licensing deal with Novartis that brought in $465 million in upfront and milestone payments.

To date, Genocea has raised $3 million in seed funding, $23 million in a Series A round in February 2009 and the $35 million in a Series B earlier this week to total $61 million in venture funding. It also has $6.1 million in grants. Its lead compound, HSV-2, is a therapeutic vaccine for herpes simplex virus type 2, or genital herpes, and is built on a platform for the rapid discovery of T-cell antigens needed to generate disease-specific cellular immune responses and long-term, T-cell memory.

Genocea said it will use the new funds to move HSV-2 into the clinic, and to advance other programs including prophylactic vaccines for Chlamydia trachomatis, Streptococcus pneumoniae, HSV-2 and Plasmodium falciparum (malaria).

“We’re confident the $35 million represents more than a couple years of operational capital for the company,” said Clark. Genocea is less than two years from having HSV-2 in Phase I clinical trials, he added, saying the company now is performing investigational new drug (IND) enabling studies. Those studies would lead to an IND filing with the US Food and Drug Administration some 30 to 60 days before the planned entry into the clinic.

Clark said the market opportunity for the lead herpes vaccine is large, with an estimated 14 percent to 20 percent of U.S. population alone infected with the HSV-2 virus, and hundreds of millions globally. The U.S. Centers for Disease Control and Prevention estimates that about one out of six Americans aged 14 to 49 have genital HSV-2 infection.

“We would propose that if we could demonstrate safety and efficacy in the clinic, our vaccine will be a very interesting new way to treat the virus,” meaning safer, more effective and easier to comply with than existing therapies, Clark said, adding that there are no herpes vaccines on the market now.

Skyline’s Hoffman said he is impressed with early studies by the company. “We think the data they’ve generated on the first three product opportunities (HSV-2, Chlamydia and Streptococcus), while still preclinical, is very encouraging,” he said. Hoffman had been watching the company since it started in 2006 as a Harvard Medical School spinout and said he felt that with the strong platform technology, board of directors and other management, now was the time to invest.

“It’s an exciting platform technology. Their core know-how allows them to use fast lab methods to discover naturally occurring antigens that we think will be more productive in treating infectious diseases,” Hoffman said. “Their know-how can be used to develop multiple product opportunities in a variety of viral, bacterial and parasitic diseases both as prophylactic and therapeutic vaccines.”