BOTHELL — Northwest Biotherapeutics Inc., which was been on the brink of closing a few times over the past two years, has found help from a Maryland-based venture capital fund.
If the fund’s managers exercise their option, they may provide up to $40 million for the Bothell-based company, and in return own more than 90 percent of its stock.
Linda Powers, managing director at Toucan Capital Corp. in Bethesda, Md., said Northwest Biotherapeutics’ promising research on anti-cancer drugs caught the firm’s attention.
"It pleases us that Toucan saw the potential in this," said Alton Boynton, Northwest Biotherapeutics’ chief executive officer. "We’re very confident in our abilities and technology and really believe it has something to offer cancer patients."
So far, the Toucan Capital Fund II has loaned the company $600,000, including a $500,000 loan made Monday. That should be enough to keep Northwest Biotherapeutics operating for another month, Boynton said.
Toucan also has the option of loaning more money between now and July 23. The loans could be converted into company stock, and Toucan already has received options to buy up to 36 million shares of Northwest Biotherapeutics stock.
Additionally, if Toucan goes ahead with a plan to refinance the biotech firm, Northwest Biotherapeutics would sell to Toucan and other investors up to $40 million worth of preferred stock. That equity financing plan, while part of the newly signed agreement between the firm and Toucan, still would require the approval of other stockholders.
Having enough cash to continue operating and even restart important clinical trials for Northwest Biotherapeutics’ drug candidates would be a welcome change. Earlier this month, Boynton warned investors that the firm of seven employees might have to shut its doors as soon as last week.
The eight-year-old firm has been developing products based on antibodies and dendritic cells — rare white blood cells that stimulate the immune system to fight cancer cells. The company also has looked at potential gene therapies.
Its leading drug candidate, potential treatment for prostate cancer, was in phase 3 clinical trials when money woes forced the suspension of further tests. Several other possible cancer drugs are in earlier stages.
The cash shortage was first announced in July 2002, only eight months after the company went public with an initial offering of stock. Since then, Northwest Biotherapeutics has come close to shutting down several times and has downsized its staff and its office space.
On Monday’s good news, the company’s stock on the Over the Counter Bulletin Board rose 3 cents, or 150 percent, to close at 5 cents a share.
Reporter Eric Fetters:
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