Venture capitalists are giving the risky field of gene therapy a new dose of confidence — and cash. Genetix Pharmaceuticals, a 17-year-old developer of gene therapies, has replenished its coffers with a $35 million Series B round of venture capital.
The Cambridge-based company attracted the fresh capital after a study in France showed that one of the firm’s gene therapies blocked the progression of a debilitating brain disorder called adrenoleukodystrophy, or ALD, in two children. This is the disease that was featured in the acclaimed 1992 film “Lorenzo’s Oil,’’ the true story of a husband and wife who searched for a cure for their son with the crippling illness. While much testing will be required to bring the gene therapy to market, Boston’s Third Rock Ventures and Cambridge-based biotech giant Genzyme were convinced that there was enough promise in the data to make big bets on the company.
Third Rock and Genzyme Ventures, the venture unit of Genzyme, are the new investors in Genetix’s second-round financing, according to the company. The round includes investments from the firm’s previous VC backers Easton Capital, Forbion Capital Partners, and TVM Capital. The new funding came with major management changes at Genetix: Third Rock partner Nick Leschly is leading the firm as interim president; Phil Reilly, a venture partner at Third Rock, has become chief medical officer; and Mitchell Finer, a veteran biotech executive, is the new chief scientist. Genetix’s chief executive, Alfred Slanetz, is leaving the firm.
Gene therapies, which typically use viruses to deliver healthy genes into cells to treat diseases, have never been approved for the market nor lived up to the hype they initially generated about two decades ago. Genetix is one example of renewed faith in the science in some scientific and investor circles. The company, one of hundreds like it that formed in the 1990s to develop gene therapies, was recapitalized in 2004 and licensed technology from the French National Institute for Health and Medical Research. The French scientists who developed that technology have generated headlines around the world for its use to cure ALD in two high-profile cases.
“We’re at that same point that we were with monoclonal antibodies 12 to 15 years ago,’’ Finer, Genetix’s new chief scientific officer, says. “You look and see the resurgence of gene therapy data. We are poised to capitalize on those advancements.’’
Genetix, which has now closed $75 million in funding since its inception, adds its own twist to gene therapy. Rather than injecting its therapies directly into patients, the company treats patients’ own bone marrow after it has been extracted from them. Once the firm’s treatments have corrected the genes in patients’ bone marrow stem cells, the cells are infused back into the patients to cure their illness. To deliver healthy genes to cells, the company uses viruses derived from deactivated HIV that are designed to die off after their job is done.
RYAN MCBRIDE
Swiss pharmaceutical behemoth Novartis signed up to back an online community for organ transplant recipients hosted by Cambridge-based social networking site PatientsLikeMe. Novartis, which has a large R&D organization in Cambridge, previously tapped PatientsLikeMe for information about patients with multiple sclerosis.
Cambridge-based Biogen Idec and its Swiss partner, Roche, reportedly halted development of ocrelizumab, an experimental drug for rheumatoid arthritis, because of safety concerns. Bloomberg News reported that the drug is still being tested for multiple sclerosis.
Vertex’s chief medical officer, Bob Kauffman, recently spoke about the biotech’s effort to develop a drug cocktail to fight hepatitis C virus while avoiding the flu-like symptoms of standard treatments for the infection. Vertex is poised to begin clinical testing of one such cocktail, which includes its experimental drug telaprevir, even as it pursues approval for telaprevir for use with standard hepatitis drugs—a milestone the company hopes to reach sometime in 2011.
Bob Weiler, chairman and CEO of Waltham-based health IT pioneer Phase Forward, spoke about his company’s strategy for maintaining its decadelong growth spurt. Having started out by convincing drug companies to switch from paper records to software for collecting and managing data in clinical trials, Phase Forward is making acquisitions to build up a suite of software products that automate everything from the early clinical development to post-marketing safety studies.
This report was compiled by the editors of Xconomy, an online news website focused on the business of technology and innovation. For more New England coverage, visit www.Xconomy.com/boston. 
