Cash could revive work on Alzheimer's drug

Cash-strapped Voyager Pharmaceuticals has raised about $4 million from investors. That may be enough money for the Raleigh company to get its promising Alzheimer's drug back on track.

Three months ago, Voyager had to put work on the drug Memryte on hold because money was running low and it couldn't pay clinical researcher Quintiles Transnational to analyze test data.

But the company regrouped, said Patrick Smith, Voyager's co-founder and chief executive. It was able to raise $3 million from several small investors. But it also had to rework a previous deal -- an effort that will end up costing Voyager some potential sales.

Memryte is one of 10 Alzheimer's drugs that have attracted international attention because of their promise. But like many small drug development companies in the Triangle, Voyager lacks product revenue and relies on investments to pay operating expenses.

The company, which was founded in 2001, raised more than $60 million from nearly 500 small investors. Its financial troubles arose after it abruptly canceled plans a year ago to raise as much as $100 million by selling stock to the public.

The failed initial public offering triggered two lawsuits. Attempts to find a corporate sponsor in the pharmaceutical industry or at least $35 million in venture capital were unsuccessful.

Without the money, Voyager was forced in October to stop two late-stage clinical trials that involved 1,000 Alzheimer's patients worldwide.

Hope now lies in getting the late-stage data analyzed, because the results could help Voyager attract a pharmaceutical partner that is willing to take Memryte under its wing. Smith expects to get results by mid-March.

In addition to the $3 million it raised, Voyager amended a 2002 agreement with Durect, a California company.

Memryte, which is implanted under the skin, consists of a small, biodegradable tube filled with leuprolide acetate, an experimental booster of approved Alzheimer's drugs.

Durect had agreed to make the tubes for the late-stage tests. In return, Voyager had promised Durect 5 percent to 7 percent of its potential sales.

Under the new deal, Voyager received $1 million and Durect forgave a $725,000 debt. In return, Voyager doubled Durect's cut of potential sales.