Arix leads first VIPE into Pharmaxis
LSE-quoted life science investor Arix Bioscience (ARIX) is to acquire an 11% interest in Pharmaxis (ASX: PXS) in its first VIPE or venture investment in public equity. Arix led a A$24m placing in the Australian biotech, in which it will invest A$14.2m for a 11% holding. This will mean the holding will rank broadly in joint second place alongside those in Iterum Therpeutics and BioMotiv in its portfolio, with each representing about 3% of its NAV. BVF Partners – manager of the US-based Biotechnology Value Fund – is to invest A$7.1m in the placing, to increase its holding to 22.9% as part of the fundraising.
The placing will be conducted at A$0.325/share – a 3.1% premium – and will be effected in two tranches, in order that shareholder approval can be sought for the second tranche. Once completed, Pharmaxis will have A$54m in pro‐forma cash. The funds raised are expected to allow Pharmaxis to expand its clinical programme for Lysyl Oxidase 2 (LOXL2) inhibitors for fibrotic diseases, including non-alcoholic steatohepatitis (NASH), idiopathic pulmonary fibrosis (IPF), heart and kidney fibrosis, while conduct partnering negotiations.
LOXL2 is an enzymatic target that acts at a crucial stage of pathogenic fibrosis, perhaps best known as the target of simtuzumab, a monoclonal antibody that was previously under development by Gilead for cancer and various fibrotic diseases. Pharmaxis has identified lead compounds with a differentiated PK/PD profile and these have demonstrated efficacy in preclinical models of fibrosis and cancer. Currently the lead molecule is in a Phase I trial. First stage of phase 1 studies demonstrate a best-in-class profile with two compounds achieving significant and long lasting inhibition of LOXL2 enzyme after a single oral dose. Final stages of Phase I studies and Phase II-enabling toxicity studies are due to complete by the end of September.