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August 29, 2007
Presidio Financing
I don't often post news here about my colleagues at Ventures West, but I thought I'd post something about a sizable financing announced today.Presidio Pharmaceuticals, Inc, a specialty pharmaceutical company focused on developing and commercializing novel, small molecule compounds for the treatment of HIV-1, HCV and other chronic viral infections, announced today that it has closed a $26 million Series B financing led by Panorama Capital. Also participating in this round were Baker Brothers Investments, Bay City Capital, Ventures West Capital, Nexus Medical Partners, and several existing Series A shareholders including Sagamore Bioventures, George Rathmann Fund and Peninsula Overview Partners.I'm excited about the antiviral market, and this is a great team, so it should be an interesting ride.
Some more background:
The Antiviral Market and HIV
Annual sales of pharmaceuticals for the treatment of antiviral infections are over $16 billion globally and are projected to approach $25 billion by 2011. HIV drugs currently account for the majority of annual sales, generating in excess of $8 billion, and should continue to help drive the overall antiviral market, with projected growth of almost 10% annually. Even after 25 years of increasing prevention, diagnosis, and treatment efforts, there are approximately one million individuals infected with HIV in the United States today, with approximately 40,000 new infections each year. In addition, over 20% of these newly-infected individuals are infected with strains that are already resistant to one or more existing therapies. HIV is expected to continue to adapt and develop resistance to current and future therapies, so that new approaches will continue to be needed within the existing combination treatment paradigm.
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The end-of-the-pipe is always attractive to invest in, especially in chronic and infectious diseases, because in the absence of effective prevention, more people will get those diseases and there will always be a market at least in developed countries (isn't a market = demand + ability to pay?).
The question is: if the investee firm delivers a working, effective product, how would you protect it from being subject to compulsory licensing provisos in poorer countries? I am interested in hearing if any new strategies are being devised for firms to address this inevitable problem in certain disease areas. Thanks.