Local Pharmaceutical Company Raises $10MMonday, April 16, 2012
Tioga Pharmaceuticals closed on a $10 million Series B equity financing, the San Diego-based pharmaceutical company announced April 12.
New investor Thomas, McNerney & Partners, which invested $8 million, led the round. Existing investor Genesys Capital Partners, a Toronto, Canada-based venture capital firm, also participated in the financing.
Tioga Chairman and CEO Stuart Collinson said the equity financing will be useful for research-and-development and general purposes. Tioga is in the midst of conducting the first of two Phase 3 trials of its compound, asimadoline, for the treatment of diarrhea-predominant irritable bowel syndrome, or D-IBS, under a special protocol assessment with the U.S. Food and Drug Administration. The randomized, double-blind, placebo-controlled clinical trial involves 600 subjects. Asimadoline has also been granted Fast Track designation by the FDA since it treats a serious medical condition and serves a high unmet need.
Collinson described the market potential for the compound as sizable, estimating it at $4.5 billion in the United States alone for patients with moderate to severe pain.
In connection with the financing, Collinson welcomed Jason Brown, principal at the health care private equity firm Thomas, McNerney & Partners, to Tioga’s board of directors.
“Jason is an experienced venture capital investor who is a former scientist,” Collinson said. “He’ll be a constructive member of the board who will bring new ideas and new thinking.”
Brown expressed confidence in asimadoline, saying it is targeted at a highly underserved market where very few therapeutic options exist for patients, and the few that do exist have safety issues. He added that it has demonstrated impressive efficacy in D-IBS patients, and an excellent safety profile in more than 1,100 subjects. Asimadoline is attractive from a commercial standpoint because the company has a recently issued patent that expires in 2028.
“I hope to contribute guidance along with several other experienced investors to drive the company toward growth and potentially an exit should they have positive data,” said Brown, who holds a Ph.D. in biology and previously conducted pharmaceutical research for Johnson & Johnson.