“SV was the perfect partner for us.”
“When GSK decided to go in a different strategic direction and move away from neuroscience, our team needed a way forward. SV provided it for us. Clive Dix knew us well from his tenure at GSK – he understood the potential. Clive and his SV colleagues joined us at the table, rolled up their sleeves and we all got to work. Because SV knew the industry, they were able to create the financial structure – through multiple stages – necessary for us to get our compounds through clinical trials. They were there when we needed them – they were a sounding board for operational and clinical issues as well as financial issues. But they also gave us a free hand to conduct the research and development as we saw fit. And they helped us structure the right exit – one that met our needs and did justice to our work. We couldn’t have asked for more in a strategic partner.”
– Simon Tate, Convergence CEO
Treatment of neuropathic pain – in such common afflictions as neuralgia and sciatica – is a major challenge for practitioners. Topical treatments have limited effectiveness, and systemic therapies can lead to serious adverse effects.
The neuropathic pain team at UK biotech giant GSK, led by Simon Tate, was one of the early innovators in the field. But in 2010, GSK decided to close its neuroscience business.
This closure of neuroscience presented SV with the opportunity to spin out the team and create a new company dedicated to novel analgesics. It came to us thanks to Clive Dix, who had been CEO of one of our portfolio companies, DNA-based vaccine developer PowderMed. Earlier in his career, Clive had been UK Research Director at GSK, where he’d recruited Simon to build the neuropathic pain team.
At the time, Simon’s team had two promising drugs in pre-clinical phases – a sodium channel blocker and a calcium ion channel moderator. SV met with Clive, Simon and the team to chart a way forward and move the drugs into clinical trials. We established required financing levels, set milestones for drawing down cash, and set the key value reflection points for potential investors. We brought in two other VCs as co-investors in $35 million in Series A funding, and negotiated terms with GSK to give them an interest in the future of the new company. The reward structure clinched the deal and the new company, called Convergence, was spun out in 2010.
SV continued to work hands-on with Convergence, providing strategic counsel during the development of a significant proof of concept study for the sodium channel blocker. In the groundbreaking Phase 2 Trigeminal Neuralgia and Sciatica study, the treatment demonstrated exceptional efficacy and safety – it led to a 53 percent decrease in pain sensitivity (vs. 18 percent for placebo) and a 60 percent average reduction in the number of paroxysms (vs. 12 percent for placebo). The treatment is now in Phase 2b/3 trials. After four years of hands-on work by Clive and the SV team, we structured the acquisition of a portfolio of Convergence assets by Biogen Idec for up to $675 million (based on future milestones) in January 2015.