Adherex goes public with $10-million IPO

Adherex Technologies Inc has forged ahead in an uncertain financial market and completed a $10-million initial public offering (IPO) that will provide sufficient funding for the early-stage biotechnology firm to reach clinical trials in two years time. The Ottawa-based company is developing unique cell adhesion technology for the treatment of cancer and it plans to use the new capital to accelerate its research efforts while seeking collaborative partners in the area of drug delivery applications.

“Once we get to clinical trials in about two years, the logical way to continue would be a second round of financing, although it could come from partners,” says Adherex president and CEO John Brooks, adding that the firm already has a co-development deal with BioChem Pharma Inc (now part of Shire Pharmaceuticals Group plc). “We’re following a typical growth pattern in terms of our research, but we’re seeking partnerships earlier than most, and we have not had a lot of venture capital (VC) funding.”

The decision to seek alternative sources of funding was made early by Adherex’s influential board of directors chaired by Dr Peter Morand and including such heavyweights as Dr Julia Levy president & CEO QLT Inc, Dr Francesco Bellini, former head of BioChem Pharma) and Judy Erola, former president of the Pharmaceutical Manufacturers Association of Canada.

By keeping VC funding to a minimum, the Adherex board has maintained a high degree of control of the company’s pace and direction. Brooks says that while he was hoping the IPO would generate up to $20 million, the firm is growing on its own terms.

Adherex is located at a life sciences park in Ottawa’s east end which has had persistent problems that reflect the challenges facing the city as it attempts to develop a life sciences cluster. Brooks says Ottawa simply doesn’t have the critical mass of other Canadian biotech centres, but he’s pleased with the support Adherex has received from area institutes. He singles out the Univ of Ottawa the National Research Council and Health Canada as particularly valuable partners in the company’s early stages.

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