Xcyte Executives (and others) Still at it on CLL Drugs; New Company Raises $$$

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Trubion raises $52 million in low-end IPO

Drug developer is just 2nd success in Seattle area in '06

By JOHN COOK

P-I REPORTER

Trubion Pharmaceuticals raised about $52 million Tuesday through an

initial public offering, only the second Seattle-area company to go

public this year.

The IPO comes at a rocky time for new issues, especially in the

biotechnology industry. Just last week, Snoqualmie-based Light

Sciences Oncology delayed its plans for an IPO because of the market

conditions.

In fact, Trubion sold its shares at the bottom end of its anticipated

range. In its original filing, the company said it planned to raise up

to $86 million.

" The market is tough and continues to be tough for biotech, " said

Graham, a lawyer at Orrick Herrington & Sutcliffe who

specializes in biotechnology. " We have seen some glimmers of hope from

time to time ... but it still remains a difficult market. "

The fact that Trubion completed its IPO says a lot about the company's

bankers, board members and management team, Graham said. " There is

something there for people to believe in. "

However, he noted that while people are rooting for a success story in

Seattle, many biotech companies have faltered once they entered the

public domain. " Over the last couple of years, a number of biotechs

have gotten out, but not that many of them are doing that well, " he said.

Founded in 1999 by former executives and scientists from Immunex,

Xcyte Therapies and Chiron, Trubion is developing drugs for the

treatment of cancer and autoimmune diseases.

The company -- backed by Prospect Venture Partners, Venrock

Associates, Arch Venture Partners, Frazier Healthcare Ventures and

others -- signed a blockbuster deal with Wyeth Pharmaceuticals earlier

this year that could be worth more than $800 million if all milestones

are met. Wyeth planned to buy a portion of Trubion at the IPO price,

though those details were not known Tuesday.

Like most biotechnology companies, Trubion is losing money and

generating little revenue. Since it was founded, it has accumulated a

total deficit of $42 million, and, because of investments in research,

the company wrote that it will " incur substantial and increasing

losses for the foreseeable future. " Revenue last year was $349,000.

But Trubion believes that its technology, dubbed small modular

immunopharmaceutical, or SMIP, offers the potential for safer and more

effective treatments. It is working on drugs for the treatment of

rheumatoid arthritis and chronic lymphocytic leukemia.

The company plans to begin trading under the ticker symbol TRBN on the

Nasdaq stock market. The two largest investors in the company are Arch

Venture Partners and Frazier Healthcare -- venture capital firms that

both have offices in Seattle. Before the offering, Arch owned 19

percent of the company, while Frazier owned 18 percent.

The only other Seattle-area company to complete an IPO this year is

Northstar Neuroscience, which priced shares in May. Its stock closed

Tuesday at $15.09, up slightly from its initial public offering price.

P-I reporter Cook can be reached at 206-448-8075 or

johncook@....

The SMIP drugs are much smaller in size compared with monoclonal

antibodies, and in theory can go places where the larger MoABs can't.

TRU-016 is the drug that would be tested in CLL. However, it binds

to a different (unnamed) target on the B lymphocyte (and to a lesser

degree on the T lymphocyte). The company claims this target is

'highly overexpressed' on the CLL molecule.

http://www.trubion.com/pdf/Trubion_TRU-016_Fact_Sheet.pdf