AVONTEC GmbH

27 September 2005

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A syndicate of investors, co-led by DVC Deutsche Venture Capital Partners and Bio-Sight-Capital a vehicle co-founded by AnGes AG and Nikko Principal Investments, has contributed E14.5m to AVONTEC GmbH in a series-B financing round. Further investors are BioMedinvest and KfW, which invested out of the â€˜ERP Startfondsâ€™. Existing investors including Innovations-Capital, ubg GÃ¶ttingen, Hildesheim and Mediport Venture Fond II, who, led by DVC, invested E5.5m in the company in September 2002 (October 2002, page 19), have contributed to the current financing round. DVC invested out of its third fund, which has a total value of E200m. The transaction, in which AnGes MG made the largest investment, was completed on 10 August.

This new capital will mainly finance the companyâ€™s latest clinical trials in anti-inflammatory areas such as asthma and psoriasis. World-class clinical experts will advise AVONTEC on the preparation of the clinical studies which will be conducted at internationally renowned hospitals.AnGes MG, responsible for co-founding Bio-Sight-Capital and joint-lead investor alongside DVC, is a specialist in genetic medicine spun off from the university of Osakaâ€™s biotechnology unit. According to reports, the Tokyo quoted company identifies strong synergies with AVONTEC in the development of decoy-based anti-inflammatory drugs. The two companies have signed a cross license agreement, which marks a commitment from both sides on operational and strategic levels. Apart from the classical exit routes such as a trade sale or an IPO in Europe, possible alternative exit strategies could now also involve an eventual sale of the company to AnGes, or even an IPO in Japan. Sources involved in the investment highlight an interest in the Japanese pharmaceuticals market.

Company

Founded in GÃ¶ttingen in 2001, AVONTEC GmbH is now headquartered in Munich and is pursuing a virtual business model resulting in a staff of 7. The company specialises in the development of anti-inflammatory approaches using its Decoy Oligonucleotide Technology. It focuses on methods to combat chronic inflammatory diseases such as asthma and psoriasis. AVONTEC won the German Founders Award in 2003.

Concentrating on its decoy-based transcription factor technology, AVONTEC hopes to work closely with AnGes MG to establish the leading nucleic-acid-based drug-developing platform in the area of novel anti-inflammatories.

People

Dr Alexander Asam led the deal for Deutsche Venture Capital, whilst AnGes/Bio-Sight-Capital was represented by senior executives from AnGes. Anges appointed Lee Cheng Liu and Hongzhi Bai as new members of the supervisory board. BioMedinvest was represented by Dr. Markus Hosang, and KfW by Christiane Barg. The existing investors, Mediport, Innovations-Capital and ubg GÃ¶ttingen were represented by Stefan Keveloh of ubg GÃ¶ttingen.