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Heptares secures funding

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LONDON, February 24 2009

– Syndicate Comprises Leading Sector Investors Clarus Ventures, MVM Life Science Partners and Novartis Option Fund

Heptares Therapeutics Ltd, the drug discovery company focused on drugs targeting G-protein-coupled receptors (GPCRs), announces today it has raised GBP21 million (US$30 million) of equity finance in a successful Series A private round from three blue-chip international venture capital firms. Clarus Ventures led the syndicate, which includes the founding investor, MVM Life Science Partners, and the Novartis Option Fund. All three investors contributed equally.

Michael Steinmetz for Clarus Ventures and Anja Koenig for the Novartis Option Fund have joined the Heptares Board of Directors as non-executive directors.

Over the next three years, Heptares intends to use the new funds to develop its own pipeline of small-molecule drug candidates using its proprietary StaR(TM) technology platform. These novel drug candidates will be developed against currently intractable GPCRs that are highly validated targets for the treatment of disease. Further progress in the application of StaR technology over this period is also expected to yield commercial partnering opportunities outside Heptares’ core focus, for example, improved therapeutic antibodies against GPCRs.

GPCRs play a crucial role in many diseases and are the site of action of 25-30% of current drugs; as such they represent a major area of interest for pharmaceutical companies. However, these membrane proteins are notoriously difficult to isolate from cells in an intact and active form and this has severely restricted efforts to study GPCRs using modern drug discovery techniques.

Heptares’ StaR (Stabilised Receptor) technology platform enables the Company to overcome this technology hurdle by engineering and purifying GPCRs in stable and functional conformations that retain their drug-binding characteristics. The Company can then apply contemporary drug discovery approaches, such as crystallisation and structure-based design, biophysical analysis of ligand interactions, and fragment screening to stabilised GPCRs. This unique approach is expected to radically improve the chances of finding drugs to previously intractable targets and enable the development of safer and more selective therapeutic agents.

Heptares was founded in 2007 as a spin-out from the prestigious MRC Laboratory of Molecular Biology (Cambridge, UK) based on world-class pioneering research and expertise in GPCRs. In 2008, the StaR technology was used successfully to elucidate the three-dimensional atomic resolution structure of the beta-1 adrenergic receptor, which is the site of action of beta blockers.

Heptares’ CEO, Dr Malcolm Weir, said: “We are very pleased to have completed this significant fundraising in the current economic environment. We are delighted to have attracted such a truly international group of blue-chip investors and see this as a real endorsement of the quality and commercial potential of our StaR technology. We now have a very good opportunity to implement our strategy for generating new drug candidates to highly validated but previously challenging GPCRs.”

Dr Michael Steinmetz, Managing Partner at Clarus Ventures, said: “Heptares has made impressive progress in developing its unique StaR technology since its inception in 2007. Its platform has the potential to make important GPCR drug targets accessible to drug discovery techniques previously not applicable to this class of proteins. The commercial opportunity arising from developing new first/best-in-class drugs to GPCRs is clear, particularly with pharmaceutical company pipelines under pressure. We are pleased and excited to participate in this funding round with MVM and Novartis Option Fund, and are committed to supporting the experienced management team in fulfilling the potential of Heptares’ innovative approach.”

Dr David Tapolczay, CEO of Medical Research Council Technology, said: “Heptares is a prime example of the importance of MRC’s long-term support for basic biomedical research and the potential for discoveries to translate into a commercial enterprise that is dedicated to producing better medicines. The fact that Heptares has attracted such a strong investor syndicate and funding round so early in its development also shows how quickly this translation of basic research into significant health benefits can be made to occur.”

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