Naurex announces completion of $38M Series B financing

Naurex Inc., a clinical-stage company developing innovative treatments to address unmet needs in psychiatry and neurology, today announced the completion of a $38 million Series B financing led by new investor Baxter Ventures.  Baxter Ventures is an investment initiative established by Baxter International in 2011 to invest up to US $200 million in promising companies.  New investor Savitr Capital also participated in the financing, along with existing investors Adams Street Partners, Latterell Venture Partners, Genesys Capital, PathoCapital, Druid Bioventures, Northwestern University and other private investors, as well as corporate investors Lundbeck, Takeda Ventures and Shire.  Naurex will use the proceeds from the Series B financing to fund a number of key programs from its NMDA receptor modulator platform, including conducting a Phase Ilb trial of GLYX-13, the company's lead NMDA receptor modulator in development for the treatment of depression, advancing its second-generation compound NRX-1074 into Phase I and Il clinical trials in depression and further developing its second- and third-generation programs for other CNS disorders.

"The recent announcement of our GLYX-13 Phase II results is a watershed event for Naurex, strongly supporting our belief that our novel NMDA receptor modulators have breakthrough potential in the treatment of depression and possibly other CNS disorders," noted Bill Gantz , executive chairman of Naurex.  "We are delighted that Baxter Ventures, which has deep experience with IV therapeutics, is leading this financing, and we are especially pleased that an individual with the broad perspective and industry stature of Norbert Riedel will be representing Baxter on our Board of Directors."

"Naurex's novel NMDA receptor modulators embody the high level of innovation we seek to support at Baxter Ventures," said Dr. Riedel, corporate vice president and chief science and innovation officer of Baxter International.  "Depression and other CNS disorders represent areas of high unmet need, and we are optimistic that Naurex's novel approach has the potential to provide valuable new therapeutic options to physicians and their patients."

Naurex's lead compound GLYX-13 is a partial agonist of the NMDA receptor.  On December 6, 2012, Naurex reported the results of a Phase IIa trial of GLYX-13 in patients who had failed antidepressant therapy.  They showed that a single intravenous administration of GLYX-13 produced significant reductions in depression scores that were evident within 24 hours and persisted for an average of seven days.  After a single administration of GLYX-13, antidepressant efficacy as measured by effect size was nearly double that seen with other antidepressant drugs after weeks of dosing.  GLYX-13 was well tolerated, and there were no signs of the schizophrenia-like side effects associated with other NMDA receptor modulators such as ketamine. 

"The strong Phase II results from our lead compound GLYX-13 laid the foundation for the Series B financing," said Derek A. Small , chief executive officer of Naurex.  "We believe that GLYX-13 has the potential to address the major failings of current antidepressants and to do so without serious side effects.  We are pleased that Baxter Ventures is leading this financing, and we also welcome new investor Savitr Capital.  In addition, we appreciate the continuing support of our existing investors."

In conjunction with the Series B financing, Dr. Norbert Reidel of Baxter International and Dr. Ian Ferrier , managing partner at Scotia-Nordic and advisor to Savitr Capital, will join the Naurex Board of Directors. 

Naurex intends to start Phase I clinical trials for its second-generation oral product NRX-1074 in early 2013.  NRX-1074 is an orally bioavailable molecule that will be developed as a therapy for major depressive disorder.  It is based on the same platform as GLYX-13, and in preclinical studies has shown similar signs of ketamine-like efficacy without apparent safety issues.

Naurex's CNS programs are based on the work of company founder Dr. Joseph R. Moskal and his colleagues at the Falk Center for Molecular Therapeutics at Northwestern University.