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Traversa Closes $2M Series A VC Round, Will Use Cash to Ramp Up Manufacturing

Traversa Therapeutics this week announced that it has closed a Series A financing round worth $2 million, money that a company official said will be used to ramp up its in-house manufacturing capabilities to meet increasing demand for its siRNA-delivery technology.
“The biggest need and use of funds in the business plan … is for manufacturing scale-up,” Traversa President and CEO Hans Petersen told RNAi News this week. Companies evaluating Traversa’s delivery technology for high-throughput screening “need the material, so that’s where we’re spending our money.”
Traversa also expects to use a portion of the cash to optimize the delivery technology for different applications including intranasal, topical, and intraperitoneal delivery, Petersen said.
Such work, he noted, is expected to help the company ink deals with biopharmaceutical firms looking to use the delivery technology for RNAi-based therapeutics.
Traversa was founded in mid-2006 to commercialize the technology, which was developed by University of California, San Diego, researcher and company co-founder Steven Dowdy.
The technology, called PTD-DRBD, comprises protein transduction domains linked with a double-stranded RNA binding domain. According to Traversa, an siRNA coated with PTD-DRBD molecules binds to cell surface proteoglycans, which stimulates macropinocytosis. The RNAi agent then enters the cell inside a macropinosome, at which point the pH inside the vesicle drops and the siRNA is released from the PTD-DRBD molecules into the cytoplasm.
Petersen said that Traversa has found the PTD-DRBD technology to be extremely efficient in vitro, triggering an RNAi response in greater than 99 percent of cells in almost every cell type, including difficult-to-transfect cells such as primary cells, hematopoietic lineages, and stem cells.
In vivo research examining the therapeutic potential of the PTD-DRBD has been promising, as well, the company said. In a mouse model of glioblastoma, an aggressive form of brain cancer, siRNAs bound to PTD-DRBD molecules and directly administered into tumors were able to completely silence expression of epidermal growth factor.
A significant increase in survival was also observed using siRNAs targeting both EGF and the oncogene Akt2, demonstrating that the technology can deliver multiple siRNAs in vivo, Traversa added.
With such data, Traversa has been able to enter arrangements with 11 undisclosed large and mid-sized biopharmaceutical companies that are evaluating the PTD-DRBD technology for use in high-throughput RNAi screens. Six of those companies are also testing the technology for use with RNAi-based therapeutics, with the potential for target-specific licensing deals.

“There were term sheets on the table for investments [larger than $2 million, but] we passed.”

Seven other undisclosed companies are also in talks with Traversa about conducting their own high-throughput screening evaluations of the technology, while discussions are underway with two undisclosed reagent companies interested in selling the PTD-DRBD technology it kit form for non-screening research applications, Petersen said.
All the screening arrangements “are moving forward at a good pace,” he said. “The results that we’re getting back are very encouraging, and we haven’t run into any snags yet,” Petersen added, suggesting that larger deals may be on the horizon.
In the meantime, Traversa has been able to tap a revenue stream by selling the PTD-DRBD material to those companies evaluating the technology, which enabled it to pass on a number of bigger venture capital offers while it was closing its Series A financing.
“There were term sheets on the table for investments [larger than $2 million, but] we passed,” Petersen said, explaining that the company’s shareholders didn’t want to reduce their equity positions to get funding that wasn’t needed because money was already coming in.
As it works to license PTD-DRBD to industry players interested in using it for either research or therapeutic applications, Traversa also continues to evaluate its own drug-development options for the technology.
Chasing Cancer
Since it was founded, Traversa has focused on oncology, and Petersen said that leukemia, metastatic ovarian cancer, and glioblastoma are the three indications the firm would most likely tackle on its own.
At the same time, the company is weighing the potential of its delivery technology for other diseases — work that involves formulating PTD-DRBD-coated siRNAs for a variety of routes of administration, he said.
Currently, the company and collaborators at UCSD are conducting in vivo studies examining the technology for intranasal, intraperitoneal, direct-to-lung, and topical delivery of siRNAs.
“Before picking specific targets [for our in-house drug-development programs] ... we want to establish the delivery characteristics [of the technology] and make sure they are the low-hanging fruit for us,” Petersen said. “Before we go full-blown into [leukemia, metastatic ovarian cancer, or glioblastoma] individually, or any other [diseases] potentially, we want to make sure we’re in the right tissues, delivering in the right way, and using the right target combinations.”

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