A fledgling drug development company whose chief executive previously enjoyed success at Aerial BioPharma and other startups has raised $49 million in funding to acquire and develop promising drugs.
The funding for Arrivo Bioventures is fully committed over five years and can be drawn down to fund new drug projects as needed, said co-founder and CEO Steve Butts. The company also is using an undisclosed amount of that funding to get the Morrisville-based company, which today has 7 full-time employees, off the ground.
Butts previously was co-founder, president and chief operating officer at Aerial Biopharma, which in 2014 sold the rights to an experimental drug for $125 million upfront plus up to $272 million in milestone payments. He also was co-founder of Neuronex, which was acquired in 2012.
“We have a proven business model here that really does develop great products for patients,” Butts said.
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Aerial was acquired by Jazz Pharmaceuticals, which led Arrivo’s funding. Among Arrivo’s other backers are Rex Health Ventures, the venture capital arm of UNC Rex Healthcare, which also invested in Aerial.
Like Aerial, Arrivo plans to acquire early-stage experimental drugs and develop them until they are ready to enter large-scale Phase 3 clinical trials. At that point, it most likely would sell or license the drugs.
“We don’t have any commercial aspirations,” Butts said.
Arrivo expects to be able to acquire and develop between four and six experimental drugs with the financing it has in place.
Arrivo doesn’t plan on going on a big hiring spree. “Ten employees is probably about where we would want to be,” Butts said.
“We’re what you would call semi-virtual,” he added. “We keep all the drug-development expertise in-house” and supplement them with consultants and contract workers.
In addition to Butts, Arrivo’s co-founders are: William Wofford, the firm’s general counsel and head of corporate development, who leads the biopharmaceutical and life sciences practice at Raleigh law firm Hutchison LLC and previously was the corporate counsel for Aerial; Michael Ackerman, a former senior vice president at Quintiles, who is chief business officer; and Jed Black, head of the sleep therapeutic area at Jazz Pharmaceuticals, who is a scientific advisor to Arrivo.