Boston Startup Intarcia Nabs $225 Million in New Financing, Looks to Double Employment

Boston Startup Intarcia  Nabs $225 Million in New Financing, Looks to Double Employment
April 28, 2015
By Alex Keown, BioSpace.com Breaking News Staff

BOSTON – Intarcia Therapeutics, Inc. received a $225 million shot of funding that will be used to finance head-to-head testing of the company’s experimental diabetes drug ITCA 650 against leading oral and injectable Type 2 diabetes medications. The financing will also lead to an expansion of employment.

Intarcia expects to double its current number of employees at its Boston facility by the end of the year, said Jen LaVin, a communications consultant with Wholepoint Communications working with Intarcia. The company currently employs about 35 people at its Boston site.

“Part of their stated expanded infrastructure to support commercial launch of ITCA 650 includes some new leadership positions as well as marketing professionals,” LaVin said in an email to BioSpace this morning.

Over the past five years Intarcia has raised more than $1 billion in private financing, LaVin said.

Intarcia said investors who participated in the latest round of financing will receive royalty payments 1.5 percent of future global net sales of ITCA 650 until the notes mature or are fully paid. For investors to break even, the ITCA 650 delivery system would have to earn about $15 billion over its market life, The Wall Street Journal reported this morning.

Investors have the option to convert their synthetic royalty interests into Intarcia common stock at a $5.5 billion company valuation during an agreed upon conversion period, the company said. The company valuation of $5.5 billion is speculated two years post the anticipated launch of ITCA 650, LaVin said.

Kurt Graves, chief executive officer of Intarcia, said the financing provides the startup company with the resources to maintain full control of the commercialization of the drug, as well as funds needed through the approval stages and eventual commercial launch planned for 2017.

The aim of ITCA 650 is to provide a once-per-year subcutaneous injection, about the size of a matchstick, and includes a miniature osmotic pump that provides continuous delivery of exenatide. Exenatide, the active agent in ITCA 650, is a glucagon-like peptide-1 (GLP-1) receptor agonist currently marketed globally as twice-daily and once-weekly self-injection therapies for type 2 diabetes. The medication controls blood sugar levels in the body.

ITCA 650 is currently in a Phase III clinical trial. Once implanted under the skin, the device will ensure that patients are compliant with their doses for up to a year, the company said. The company said research shows patients often do not remain compliant with their medication requirements, which the ITCA 650 system would address.

If the drug receives approval from federal regulators, ITCA 650 would represent the first injection-free GLP-1 therapy that can deliver up to a full year of treatment from a single placement.

There are a number of current drugs on the market to treat Type 2 diabetes, including other injectables, such as AstraZeneca PLC ’s Symlin.

In addition to ITCA 650, Graves said the company is also “advancing our product pipeline more aggressively, including our recent Numab collaboration, aiming to develop new once- or twice-yearly antibody-based therapies and combinations for diabetes, obesity and autoimmune diseases.”

Last year Intarcia entered into an agreement with the potential to be worth more than $1 billion with Servier, a French pharmaceutical company, to co-develop ITCA 650 in some markets outside of the United States.


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