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STARTUP INTARCIA RAISES $225 MILLION

http://intarcia.com/media/in-the-news/2015-04-wsj.html

Intarcia Therapeutics Inc. said it raised $225 million in the latest in a series of financings to support development of its implantable drug-delivery pump for patients with diabetes.
The Boston-based startup said investors will receive a 1.5% royalty on future global net sales of the device, along with an option during a certain window to convert the royalty interest to stock at a price that values the company at $5.5 billion. In March of last year, Intarcia was valued at $1.75 billion, according to Dow Jones VentureSource.
The device, called ITCA 650, is a matchstick-size pump that holds up to a year’s supply of exenatide, a drug commonly prescribed to control blood sugar in patients with Type 2 diabetes.
Implanted in abdominal tissue, the pump continuously delivers micro quantities of the drug, enabling patients to maintain consistent blood-sugar control while assuring they stay on the medicine.
The financing round reflects a conviction that the pump, which Intarcia expects will reach the market in early 2017, will prove to be a huge seller. For the investors to break-even while earning a 1.5% royalty, the pump would have to fetch total net sales over its market life of $15 billion. ITCA 650’s patent life extends through 2031, the company said.
Kurt Graves, chairman, president and chief executive officer, said based on market research that the global market for current diabetes medicines will reach $65 billion to $80 billion by the middle of the next decade, each 1% market share would result in $1.3 billion of sales for ITCA 650.