See the article below regarding NPI-2358

Priscilla A. Savary
Executive Director
Colorectal Cancer Network
PO Box 182, Kensington MD 20895
301-879-1500
psavary@...
www.colorectal-cancer.net
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Nereus, Vitae Raise Funds For Clinical Trials In 2005

By Jennifer Boggs

Staff Writer

Two companies started the new year on a high note. Nereus Pharmaceuticals Inc.
and newly named Vitae Pharmaceuticals announced they had raised funds to push
their products into clinical trials in 2005.

Marking its fourth financing round, San Diego-based Nereus will be receiving a
$42.6 million private placement in two tranches. The first, already closed,
amounted to $24.3 million.

The second tranche will be $18.3 million upon completion of development
milestones, said Nereus President and CEO Kobi Sethna.

"We'll draw down the rest once we reach our milestones, which are
investigational new drug applications for our two lead compounds," he told
BioWorld Today. "Then we'll have funding in place for conducting clinical
trials."

In its first three rounds, Nereus raised $38 million, Sethna said.

New investors HBM BioVentures Ltd., of Baar, Switzerland, and HBM BioCapital LP,
of Research Triangle Park, N.C., led the fourth round, along with returning
investors Alta Partners, of San Francisco; Forward Ventures, of San Diego; GIMV,
of Antwerp, Belgium; Novartis Bioventure Fund, of Basel, Switzerland; Pacific
Venture Group, of San Francisco; and Lotus BioScience Ventures, of Hong Kong.

Sethna estimated that the $42.6 million will sustain the company for the next
two to three years.

"It depends on how the clinical trials go and whether we partner the compounds,"
Sethna said. "We've been talking to pharmaceutical companies about possible
joint development projects, so that could change the picture."

He said Nereus hopes the funds will get its first compound, NPI-2358, a vascular
disrupting agent, into Phase II trials and its second compound, NPI-0052, a
proteasome inhibitor, into Phase I studies.

"Then we'll see what the market looks like and decide whether to go public or
seek additional private funds or partner with pharmaceutical companies," Sethna
said. "In two or three years, I think, if all goes well with the clinical
trials, there's a good chance we'll probably seek some public funds."

NPI-2358, a cancer product that works as a targeted compound rather than a
cytotoxic drug, is a selective tumor vascular disrupting agent (VDA) designed to
treat solid tumors. The parent molecule of the compound was isolated from a
marine fungus that provided the chemistry.

"The compound works on its own and synergistically with chemotherapy and
radiotherapy," Sethna said, adding that the company plans to begin human trials
in a few months.

The compound initially will be tested by itself, but Sethna said later "it will
be tried in combination as we move along in the process."

He added that while VDA is a scientifically proven treatment, a VDA compound has
yet to be approved by the FDA.

"So we're on the cutting edge here," he said.

Nereus' second targeted compound, NPI-0052 (salinosporamide), is derived from a
marine-obligate actinomycete and is designed as a second-generation proteasome
inhibitor to treat multiple myeloma. The concept of looking for treatments by
inhibiting proteasomes has been a popular concept since the FDA approved
Cambridge, Mass.-based Millennium Pharmaceuticals' Velcade in 2003, Sethna said.

In vitro data presented at the American Society of Hematology meeting in
December by Nereus and Harvard Medical School's Dana-Farber Cancer Institute
showed that the compound was active in multiple myeloma cells resistant to
Velcade, as well as desamethasone and doxorubicin, though exact mechanisms still
were under investigation. (See BioWorld Today, Dec. 10, 2004.)

"This is a very exciting compound for us," Sethna said of NPI-0052. "Also, on a
preclinical basis, it shows more safety and does not have the same kind of toxic
effects of other chemotherapy treatments."

Nereus has filed an accelerated investigational new drug application for
NPI-0052, and Sethna said the company hopes to begin Phase I trials by the
latter part of the year.

Using its marine microbial drug discovery platform, Nereus has "a host of other
compounds in the wings that will be studied for potential use as anti-cancer,
anti-inflammatory and anti-infectious agents," he said. "We'll be making
selections of compounds to begin development in 2006 and 2007."

Created in 1998, Nereus began work in late 2001 isolating marine microbes.
Sethna said in the last two years, the company "has grown exponentially."

Nereus also recently named three new directors to its board: incoming Director
Gary Shearman, of HBM Advisors USA; Jason Fisherman, of Advent; and Nina
Kjellson, of Interwest Partners.

Vitae's $34M Part Of 'Rapid Evolution'

Fort Washington, Pa.-based Vitae Pharmaceuticals, formerly Concurrent
Pharmaceuticals, introduced its new name and secured $34 million in equity
financing to accelerate the company's product programs.

Tuesday's announcements encapsulate "the rapid evolution of our company," said
Vitae CEO Jeff Hatfield. "The name change emblemizes that revolution."

Vitae, a Latin word meaning "life," reflects the company's efforts to mark
itself as a product-focused drug development company, Hatfield said.

He described Vitae as being "at the forefront of the trend of rapid product
creation," with plans for four products to begin clinical trials in 2005.

"What's really important about all our efforts is the trend to rapidly create
valuable products," he said.

Vitae has raised $75 million to date, including the $34 million in funding from
two new investors - Atlas Venture, of Boston, and Wellcome Trust, of London -
and existing investors Prospect Venture Partners, of Palo Alto, Calif.; Venrock
Associates, of New York; and New Enterprise Associates, of Menlo Park, Calif.

The money will be used to accelerate product candidates as they begin human
trials and, later, to help expand research and commercialization, Hatfield said.

"I hope this will sustain the company for a two- to three-year horizon," he
said, adding that funds will be used to pay for upcoming clinical trials for
four of Vitae's products.

The company's lead cancer program is set to start human trials in the first half
of this year. Initial studies will focus on lymphoma, though the compound might
also be tested for additional cancer indications.

Also in the pipeline is a compound aimed at treating myeloid leukemia. The
company is developing a selective modulator of a nuclear receptor subtype
thought to play a role in neutrophil differentiation and, based on preclinical
studies, might be applied to treat and prevent chemo-radiotherapy-inducted
neutropenia and to enhance peripheral blood progenitor-cell mobilization in
transplantation.

A third product, a topical agent designed to treat psoriasis, eventually might
be extended to the treatment of acne and photo-aging, based on results from
clinical trials to begin this year.

The fourth product in preclinical development is an orally available renin
inhibitor to manage hypertension and end-organ protection. Renin, an aspartyl
protease, is the rate-limiting enzyme in the renin-angiotensin system that plays
a key role in regulating blood volume, arterial pressure and vascular function.

Clinical studies have shown that inhibition of renin can control blood pressure,
though most programs have not been successful in finding orally available
small-molecule compounds suitable for development. Hatfield said Vitae is using
its technology to generate non-peptidic renin inhibitors and has discovered
multiple series of small-molecule inhibitors of the enzyme.

"Vitae selected this as our target challenge," he said. "We believe in a unique
approach that combines the talent of drug discovery skills to achieve innovative
products."

In May, the company bought a portfolio of near-clinical compounds from Allergan
Inc.'s retinoid and rexinoid nuclear receptor drug program. Vitae, then known as
Concurrent, gave Allergan undisclosed equity plus potential future milestone
payments and royalties in exchange for exclusive license rights to compounds for
diabetes and cancer. (See BioWorld Today, May 27, 2004.)


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