September 21, 2007 »»» Pradama Pharmaceutical Firm Gets Second-Round Funding

A Louisville pharmaceutical company has received a second round of funding to continue its research to develop drugs that treat and prevent bone disease.

Triathlon Medical Ventures, Commonwealth Seed Capital LLC and the Kentucky Seed Capital Fund have invested a total of $700,000 to help fund research by Pradama Inc.

The investment comprised $300,000 from Triathlon, $250,000 from Commonwealth Seed Capital and $150,000 from Kentucky Seed Capital, according to Andy Steen, vice president business development for MetaCyte Business Lab LLC.

MetaCyte is a business incubator owned by nonprofit Louisville Medical Center Development Corp. that supports Pradama and other health-related startup companies.

Triathlon, which is based in Cincinnati and has an office in Louisville, is a venture-capital firm that invests in life-sciences companies.

Commonwealth Seed Capital is a venture fund created by the state of Kentucky to support early-stage science and technology companies.

The Kentucky Seed Capital Fund was formed by Louisville venture capitalist George Emont to provide funding to early-stage life-sciences companies in Kentucky and Southern Indiana.

Emont also is managing partner of the Kentucky Seed fund.

Pradama was formed in 2005 by officials with MetaCyte and William Pierce Jr., a professor of pharmacology and toxicology at the University of Louisville.

The company will use this funding to continue work toward the development of an oral medication to treat and prevent osteoporosis, according to Pierce. Osteoporosis is a disease that causes the bones to become brittle and often break.

To date, Pradama has received $1.15 million in investments. Initial funding came from various academic grants.

The first round of venture funding came in 2006 when Pradama received $250,000 from the Kentucky Seed Capital Fund and $200,000 from the Kentucky Science and Technology Corp.

The first round of investments was used to help fund research and prepare documentation for the U.S. Food and Drug Administration in preparation for Phase I clinical trials. (See related item below.)

Company still moving toward clinical trials

Pradama's research remains in the pre-clinical stage as the company continues to test its product on animals rather than humans.

"We are still pushing toward the first clinical trial," Pierce said. "We would hope within a year and a half to move into our first clinical trial."

Pradama is using rats for testing of several related chemical compounds that one day could be developed into a medication for the treatment of bone disease.

Although testing on animals can give a good indication of how a medicine would interact with the human body, it is also expensive, Emont said.

Emont, who also is a partner in Triathlon and oversees its Louisville office, said that although Triathlon typically would not invest in early-stage research, Pradama is close to being prepared for a clinical trial.

"There are a number of expenses for them along the way," Emont said. "And they need to get another set of data together to prepare for the FDA. These early-stage fund investments help build a body of knowledge and evidence."

Emont said this is Triathlon's first investment in a Louisville company since it opened an office here in 2004 after receiving a total of $5 million in investments.

That backing was provided the University of Louisville, Jewish Hospital & HealthCare Services Inc. (now Jewish Hospital & St. Mary's HealthCare Inc.), Norton Healthcare Inc. and the Louisville Presbyterian Theological Seminary.

Since then, the regional venture-capital firm has made numerous investments in health-science ventures in the Northeast and Midwest.

Company will seek more funding

Pierce said additional funding will be needed once the company reaches the clinical trial stage. "When you get into clinical trials, you will spend a tremendous amount of money."

Preparing for and participating in Phase I clinical trials could cost as much as $5 million to $8 million, Emont said.

Steen said Pradama probably will look for another round of investments within a year.

For those funds, the company will look to Triathlon as well as other large venture-capital funds, he said.

Pierce said he is not sure whether he wants Pradama to market the product or sell it to a larger pharmaceutical company.

One thing he does know -- it will take even more funding to get his product to the point of marketing.

"It depends, but the typical path for these things is you push them as far along as possible, and then you sell it to another larger company," Pierce said.

Phases Of Clinical Trials

Clinical trials -- the human research studies used to determine whether new pharmaceuticals are safe and effective -- generally involve four phases.

The trials begin after initial discovery and development of a drug is completed but before the drug receives final approval from the U.S. Food and Drug Administration for sale in the United States.

Phase I: Researchers test a new drug or treatment in a small group of people for the first time to evaluate its safety, determine a safe dosage range and identify side effects.

Phase II: The drug or treatment is given to a larger group of people to determine whether it is effective and to further evaluate its safety.

Phase III: The drug or treatment is given to even larger groups of people to confirm its effectiveness, monitor side effects, compare it with commonly used treatments and collect information that will allow the drug or treatment to be used safely.

Phase IV: Studies are done after the drug or treatment has been marketed to gather information on the drug's effect in various populations and to determine any side effects associated with long-term use.


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