Biotechs Biting the Dust

On Tuesday, Epix Pharmaceuticals announced that they were dissolving.  And unlike many innovative life sciences companies, they’re not being acquired by another company to take advantage of their research, nor are they evaporating because their one line of research failed in clinical development.  Rather, they’ve just run out of money, can’t raise any more, and their assets are worth less than their debt.  So they’re selling off what they can, and locking the door behind them.

While the company’s announcement isn’t too reveling about their history, looking at their information on Yahoo! Finance shows that while they have consistently lost money, (as do virtually all biotech companies without products to sell), year-over-year, revenue was increasing and the losses were shrinking.  And the company’s profile described various areas of clinical development:

“EPIX Pharmaceuticals, Inc., a biopharmaceutical company, engages in the discovery and development of therapeutics through the use of its proprietary silico drug discovery technology to treat diseases of the central nervous system and lung conditions. Its therapeutic product candidates in development include PRX-03140, which completed Phase II clinical trials for the treatment of Alzheimer’s disease; PRX-08066, a small-molecule inhibitor that completed Phase II clinical trials for the treatment of pulmonary arterial hypertension and pulmonary hypertension associated with chronic obstructive pulmonary disease; and PRX-07034, which completed Phase I studies for the treatment of cognitive impairment associated with schizophrenia. The company also offers Vasovist, an injectable intravascular contrast agent to provide enhanced imaging of the vascular system using magnetic resonance angiography. It has collaborations with SmithKline Beecham Corporation, Amgen Inc., and Cystic Fibrosis Foundation Therapeutics, Incorporated. The company was formerly known as EPIX Medical, Inc. and changed its name to EPIX Pharmaceuticals, Inc. in 2004. EPIX Pharmaceuticals, Inc. was founded in 1988 and is based in Lexington, Massachusetts.”

The Boston Globe also had an article about Epix’s demise, which also noted that Biopure, another Massachusetts life sciences company announced it was going under last week – however Biopure, which had been working on a blood substitute, was much more of a “one trick pony” than Epix.

Last fall I’d written about how biotech companies were treading water because of problems raising new money, and while several other smaller companies have been acquired, I don’t recall hearing about such a previous high profile company completely dissolving.  The ongoing challenge in the current economic quagmire will be for start-ups to find their initial funding, and to see if larger biotech and pharma companies can be enticed by science and economics to buy any of the remnant companies – although with the Merck/Schering-Plough and Pfizer/Wyeth pending combinations, those major players most likely won’t be in the market for new acquisitions anytime soon.

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