Bear out of Hibernation

Euthymics Bioscience gets $24M from VCs to revive CNS assets from Dov PharmaFrench plays Cerenis, Trophos and Novagali boost VC fortunes

Dov Pharmaceutical Inc. has been slowing dying for a long time, but its neglected assets are now back in play in newco Euthymics Bioscience Inc., which VCs financed with $24 million in a tranched series A round last week.

At the same time, Euthymics completed its merger into Dov, which was announced in February, but taking it private instead of keeping the public listing.

Dov was founded in 1995, and along the way held rights to the ill-fated sleep drug indiplon before licensing it to Neurocrine Biosciences Inc. (NASDAQ:NBIX). The beginning of the end came in 2006 when lead candidate bicifadine missed the primary endpoint in a Phase III trial to treat lower back pain.

The company tried to rally around its next molecule, DOV 21,947 (now EB-1010), which was in Phase I trials to treat major depression. However, also in 2006, Dov and Merck & Co. Inc. (NYSE:MRK) terminated a partnership covering the compound, and Dov began seeking strategic options.

In late 2007, Dov began a 200-patient Phase II trial of EB-1010, a serotonin, norepinephrine and dopamine reuptake inhibitor, but halted it prior to completion and never analyzed the results, as it was never able to raise money.

Eventually, the management team that would form Euthymics analyzed the data and decided the compound was worth forming a company around, according to Campbell Murray, managing director of Novartis Venture Funds and chairman of Euthymix.

While Euthymics' assets come from Dov, its co-founders came from obesity play Orexigen Therapeutics Inc. (NASDAQ:OREX): President and CEO Anthony McKinney, who had been COO and CBO at Orexigen, and CSO Franklin Bymaster, who was Orexigen's VP of neuroscience.

"The management team that now forms Euthymics first analyzed the data and saw remarkable efficacy results that no one else in the world had seen," Murray told Ebb & Flow. He added that Novartis Venture Funds hired its own consultants to verify the data.

With 63 patients randomized and 56 patients in the intent to treat population, EB-1010 showed statistical significance on the primary endpoint, the Montgomery-Asberg Depression Rating Scale (MADRS) using the MMRM imputation method. The Euthymics team also found a benign safety profile, with no marked difference between

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