Paying the iron price
Why MPM, Novartis are betting on Sideris' preclinical iron chelator
A group of VCs and Novartis AG (NYSE:NVS; SIX:NOVN) are betting that Sideris Pharmaceuticals Inc.'s iron chelator program can better the pharma's iron overload drug Exjade deferasirox, as well as a compound from Shire plc (LSE:SHP; NASDAQ:SHPG).
Last week, Sideris raised $32 million in a series A round led by MPM Capital with participation by Hatteras Venture Partners and Osage University Partners. The financing is the fourth-largest series A round this year for a preclinical biotech.
In addition, Novartis received an exclusive option to acquire Sideris in a deal that could be worth up to $300 million, including upfront, option exercise and milestone payments.
The biotech's SP-420 is an oral small molecule to treat transfusion-related iron overload, with Phase I testing slated to start next year. Sideris said it expects the Novartis deal and series A money to last through a Phase II trial.
"There is some preclinical data that suggest Sideris' molecule may have advantages over Exjade," said MPM's Kazumi Shiosaki, who joined Sideris' board. Sideris and Shiosaki declined to disclose details of the SP-420 program.
Exjade is marketed to treat transfusion-related iron overload. It carries a black box warning that the product may cause renal or hepatic failure and/or gastrointestinal hemorrhage.
Last week, Novartis reported Exjade sales of $649 million for the nine months ended Sept. 30.
Shire also is looking to improve upon Exjade.
Last year, it paid $100 million up front plus up to $225 million in milestones to acquire Ferrokin BioSciences Inc. and gain SPD 602. The oral metal chelator is in Phase II testing for transfusional iron overload. Based on preliminary Phase II data at the time of the deal, Shire thought SPD 602 had a better tolerability and safety profile than Exjade (see BioCentury, April 2, 2012).
The IP around SPD 602 was generated in the lab of Sideris co-founder Raymond Bergeron, according to Shiosaki. Bergeron has designed and developed a number of iron chelator analogs.
"Ferrokin's molecule can be considered an earlier