Largest Series A in the European Life Sciences Sector for 2 Years1
London (12 October 2010) – A team of lawyers in the life sciences group at Morrison & Foerster advised on the $35.4 million (£22.4 million) Series A financing of Convergence Pharmaceuticals Ltd., a spin out from GlaxoSmithKline (“GSK”). Morrison & Foerster acted for a consortium of leading investors comprising Apposite Capital, New Leaf Venture Partners and SV Life Sciences, who invested in the fundraising.
The proceeds of the fundraising will be used to fund Phase I and Phase II Clinical Trials in the area of novel and high value analgesic medicines. GSK also has a minority equity stake in the new company.
Convergence Pharmaceuticals has Phase I and Phase II clinical programmes in development and a pipeline of six earlier stage compounds. Drugs within the pipeline target the major points of convergence in chronic pain signalling through modulation of specific ion-channels. Convergence Pharmaceuticals, which has a well validated approach to pain therapy, will immediately initiate Phase II proof of concept studies in neuropathic pain with the Company’s lead drug, a voltage-gated sodium channel blocker (CNV1014802), and a Phase I study of its first-in-class voltage-gated calcium channel blocker (CNV2197944) for the treatment of neuropathic and inflammatory pain including osteoarthritis. Both of these compounds have demonstrated efficacy, safety and tolerability profiles to date and have functional properties that differentiate them from currently available chronic pain treatments.
The Morrison & Foerster team was led by corporate partner James Gubbins and included Sophie McGrath (corporate); James Ryan and Deidre Moynihan (commercial) from the London office. Support on IP due diligence and patents was provided by James Mullen and Kate McElhone in San Diego.
James Gubbins commented, "This is a significant fundraising, one of the largest European biotechnology Series A funding rounds in recent years. It shows that even though there is undeniable softness in the sector, there is early stage capital available for life sciences companies. A strong management team, good IP, innovative products in areas of unmet need, or a strong position in a fast growing market are all important to success."
James Gubbins and Sophie McGrath also advised on a £3.6 million cash placing for IS Pharma plc, an AIM-listed international speciality pharmaceutical company. The placing price at 77 pence represents a 9 per cent. premium to the closing price of 70.5 pence per ordinary share on 5 October 2010. Following this placing, which is conditional upon, inter alia, admission of the Placing Shares to AIM, Abingworth LLP will be IS Pharma’s largest shareholder.
1. Based on data from Dow Jones VentureSource.