Millennium Spinoff Raises $21M

The team that makes up Portola Pharmaceuticals is now on its third company in two years.

The South San Francisco-based company, which is developing novel therapeutics for treating cardiovascular disease, began life as the venture-backed COR Therapeutics, which raised more than $20 million in venture capital before Millennium Pharmaceuticals acquired it in late 2001. The team has now spun out of Millennium to form Portola with $21 million in Series A financing, announced last week.

MPM Capital, Prospect Ventures and Sutter Hill Ventures co-led the round with investments of $5 million each. Abingworth Management and Frazier Healthcare Ventures also participated in the round with investments of $3 million each.

Millennium Pharmaceuticals has also retained a small stake in the company.

Jeff Bird, managing director with Sutter Hill, which was an investor in COR Therapeutics, says that the toughest part of negotiating the deal was not setting the valuation, which he declined to disclose, but the extent to which intellectual property had to be licensed from Millennium.

Bird tips his hat to Millennium and says that the company was helpful in getting Portola off the ground. Bird has joined Portola’s board of directors along with Michael Bigham of Abingworth, Alan Frazier of Frazier Healthcare Ventures, Nick Galakatos of MPM and Russell Hirsch of Prospect Ventures.

Portola’s target market consists of patients that are not able to use the current cardiovascular drug Plavix. “There are going to be novel mechanisms of treating inflammation of cardiovascular disease,” says Bird. “There are significant number of patients who are Plavix resistant. That’s not well understood. There are patients who are aspirin resistant as well.”

The funds will support the company’s pre-clinical trials, licensing of technology from outside the company and for working capital. While Portola will not have products in the market until around 2010, the company plans to have its clinical trials on humans started by the summer of 2005. Neither investors nor the company’s management see much immediate growth in store for Portola’s 32-person staff.

But further fund-raising efforts appear to be near.

Charles Homcy, Portola’s co-founder and CEO, says that the company could raise money again as soon as early 2005 if it is successful in acquiring the rights to a new compound next year.