Team that launched Neurochem hopes to match its success with new Queen’s spin-off
April 26, 2004
The Queen’s Univ professor whose previous research led to the formation of Neurochem Inc is the driving scientific force behind the creation of AtheroChem Inc. The cholesterol research of Dr Robert Kisilevsky, a professor of anatomic pathology, is deemed to possess considerable scientific and commercial potential for reversing the development of atherosclerosis, the primary cause of coronary heart disease.
AtheroChem is being touted as having the same major growth potential as demonstrated by NeuroChem — now a stock market darling in the hands of legendary biotech executive Dr Francesco Bellini. ArtheroChem’s backers hope that the seed financing round they are currently accumulating will lead to the same kind of investor interest, but many hurdles must first be overcome.
AtheroChem has been launched with nearly $200,000 in funding in two stages from the Canadian Institute for Health Research’s proof of principle (POP) program. The first award was made to Kisilevsky in late 2002 while the second award was made earlier this year under the POP partnered program. The latter is intended to further develop the relevant technology and is made on the condition that it leverages twice as much from a partnered company.
That led to the creation of AtheroChem and $200,000 was raised from private investors by ARGIL Management LLC. ARGIL is a Boston MA-based firm specializing in early-stage life sciences companies that provides equity-based investments coupled with hands-on management expertise. Preliminary intellectual property protection and positioning were handled by PARTEQ Innovations — Queen’s Univ’s technology transfer arm— in much the same way as NeuroChem was formed.
Robert Bender, an Ottawa-based partner with ARGIL, is AtheroChem’s acting CEO. He is currently working to raise $750,000 in seed financing from angel and other private investors to augment the significant financial contribution his own company is making. That financing will allow AtheroChem to develop its lead drug candidates and do most of the required pre-clinical work, before moving on to series A venture capital financing of $5-7 million. Those lead candidates target cholesterol-laden fatty deposits or plaques that lead to atherosclerosis.
Bender credits CIHR’s POP program as precisely the kind of public assistance that’s required to bridge the gap between lab bench and preliminary angel and VC interest.
KEY CIHR SUPPORT
“The Proof of Principle program is certainly having an impact. While it was not in and of itself enough to get us involved, it’s been very helpful because early-stage money is hard to get,” says Bender. “There’s a huge shortage of money for what the Proof of Principle program is doing. My only reservation is that (the program) isn’t larger and doesn’t have more resources.”
Bender has worked with PARTEQ in the past and was instrumental in putting together the initial NeuroChem financing that became one of Queen’s Univ’s most successful spin-offs. He cautions that it’s still premature to accurately assess AtheroChem’s commercial potential, but says it’s certainly significant.
“When I did the Neurochem deal I got to know Dr Kisilevsky well, so when (PARTEQ president and CEO) John Molloy told me about this project I didn’t hesitate to join,” says Bender. “It’s too early to know but it could be as big as Neurochem. It’s a wonderful project.”
Kisilevsky has long been one of Queen’s Univ’s most prominent life sciences researchers. He has received uninterrupted funding from CIHR and its precursor — the Medical Research Council — since 1969 to support his research into abnormal protein structures, in particular amyloids which lead to Alzheimer’s and adult-onset diabetes.
Neurochem was formed in 1993 and built around the anti-amyloid compound discoveries of Kisilevsky and his colleague Dr Walter Szarek. The Montreal-based firm is now conducting clinical trials with three compounds relating to Alzheimer’s, cerebral hemorrhages and a form of amyloidosis that complicates rheumatoid arthritis.