Intarcia Therapeutics yesterday took its total raise to more than $1 billion with a $225 million funding round it plans to use to run clinical trials and commercialize its the drug-device combination treatment it’s developing for Type II diabetes.
The debt round, involving convertible notes that pay of 1.5% of future royalties until repaid, values the company at $5.5 billion, Boston-based Intarcia said. Once its ITCA 650 treatment wins U.S. approval, investors have a 2-year window to convert the notes to Intarcia stock at the $5.5 billion valuation, the company said.
The clinical studies will compare ITCA 650, a matchstick-sized, miniature osmotic pump inserted subcutaneously to deliver the drug exenatide for 1 year, with “leading oral and injectable” Type II diabetes therapies, Intarcia said. The funding is also slated to finance “the expected infrastructure and talent required to launch ITCA 650 in the United States, and to advance the company’s recently in-licensed pipeline assets,” according to a press release.
Intarcia, which last year inked a $1 billion development deal with French pharmaceutical independent Servier, raised a $210 million round back in November 2012. Last year saw another $200 million addition, plus a $171 million up-front payment from Servier, a company spokeswoman told MassDevice.com, on top of “several” previous bridge rounds of undisclosed amounts.
Chairman, president & CEO Kurt Graves said the company hopes ITCA 650 will deliver a once-yearly medicine that’s easier to comply with and more effective than current treatments.
“This large and innovative financing announced today is another 1st-of-its-kind in our industry, and it shows investor confidence in our pivotal data, our partnerships and our overall approach to a huge unmet need and opportunity in Type II diabetes. We’ve now secured the financial means to keep 100% control of the U.S. commercialization of ITCA 650, with funds needed all the way through the planned approval and early launch period in 2017. In parallel, we are 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,” Graves said.