Life sciences briefing: Tuesday, Aug. 7, 2007

(UPDATED at 12:30pm PT — see below.)

Featured companies: Capnia, AutekBio, Novacta Biosystems, XLHealth, Leprechaun, Agility Healthcare Solutions, AM Pharma, Milestone Pharmaceuticals, ChanTest

Capnia names former Alza head as CEO — The tiny Palo Alto, Calif., biotech Capnia hired Ernest Mario, a storied figure in the pharma/biotech world, as its CEO. Mario was most recently chairman — and previously CEO — of Reliant Pharmaceuticals, but he’s best known for running drug giant Glaxo (now GlaxoSmithKline) and, immediately thereafter, helming Alza for eight years until Johnson & Johnson acquired it for $10.5 billion in 2001.

Ever since his Alza experience, however, Mario has kind of been hopskotching his way across the industry. He headed Apothogen for four months until it was acquired by IntraBiotics (now Ardea Biosciences), then ran the combined company for a year before skipping to Reliant. Needless to say, the Alza lightning hasn’t yet struck twice.

Capnia’s interesting strategy is to develop drugs that can be delivered as a gas, presumably to be breathed in through the lungs. The company’s lead product, Capella, aims to treat migraines and nasal inflammation such as hay fever, and is currently in mid-stage testing.

Here’s the take on Capella from VentureWire (subscription required):

Capnia uses a gas dispenser to administer carbon dioxide into the nose. The company contends that this may be a safe and effective way to quickly relieve pain caused by migraine attacks and stuffy nose caused by allergies to pollen or environmental things like dust mites or pets. The company has conducted multiple Phase II studies in migraines and rhinitis and is planning additional Phase II trials, said Graham Crooke, managing partner of Asset Management Co.

Biologics manufacturer AutekBio raises $1.1M — AutekBio, a Silicon Valley-Chinese hybrid with its headquarters in Santa Clara, Calif., and operations in Beijing, raised $1.1 million in a first funding round, VentureWire reports. Acorn Campus Ventures and Desert Spring Life Sciences Capital led the round.

The company is a biological contract manufacturer that cultures genetically engineered cell lines for biotech and pharmaceutical concerns. AutekBio plans to raise a larger $10 million round in early 2008, according to VentureWire.

Novacta Bio raises $827K for new antibiotics — U.K.-based Novacta Biosystems, an antibiotic developer in Welwyn Garden City, England, raised $827,000 (€600,000). Investors in the round included Esperante, Westgate Hall, GEIF Ventures and Oxford Technology 4 VCT. Novacta is developing drugs to treat hospital-acquired infections, which are often resistant to standard antibiotics. Its lead candidate, for C. difficile infections, hasn’t yet been tested in humans.

Healthcare specialist XLHealth raises $290M, acquires Leprechaun — XLHealth, a private-equity backed healthcare-services company in Baltimore, raised $290 million in debt and equity and used part of the proceeds to acquire Leprechaun, a provider of healthcare-technology services based in Fort Worth, Texas. Funding was provided by MatlinPatterson Global Advisors, a private-equity firm. XLHealth says it is focused on improving the care of chronically ill seniors.

RFID patient-tracker Agility Healthcare raises $2M in debt — Agility Healthcare Solutions, a Richmond, Va., developer of patient-tracking systems utilizing RFID chips, closed a $2 million “credit facility” that supplements an earlier $6.25 million first funding round it raised in February. Square 1 Bank provided the loan.

Dutch biotech AM Pharma raises $3.4 million against infection and inflammation — AM Pharma, a biotech based in Bunnik, the Netherlands, raised $3.4 million (€2 million) in bridge financing. The company’s two main investors, Forbion Capital Partners and Inventages Venture Capital, provided the funding. AM Pharma is primed to begin raising a third round of funds; its lead drug candidates are respectively in mid- and early-stage human tests against kidney failure, ulcerative colitis and hospital-acquired infections.

Milestone Pharmaceuticals raises $2.6M against inflammation and heart disease — Montreal’s Milestone Pharmaceuticals, a biotech developing drugs against inflammation and heart disease, raised $2.6 million (C$2.75 million) toward its first funding round, VentureWire reports. Investors included MSBI Capital, Fonds Bio-Innovation and an undisclosed individual investor.

Cleveland’s ChanTest draws funds from Ampersand — ChanTest, a Cleveland, Ohio, developer of cell-based tests for drug safety, raised an undisclosed amount of funding from private-equity firm Ampersand Ventures. The company said the funding would support “strategic investments.”

From the company’s press release:

ChanTest’s primary focus is on a family of proteins known as ion channels. There are 400 genes encoding ion channels in the human genome, and countless more can be assembled from this gene collection. These ion channels may either represent targets for new drug development, or unintended targets that can result in unwanted side effects from new drugs. ChanTest pioneered the development of functional, cell-based ion channel testing as a means to predict cardiac side effects produced by non-cardiac drugs. Such testing is now a standard component of regulatory submissions prior to approval of drugs in humans.

UPDATE (11:05am PT): Added items on Novacta, XLHealth/Leprechaun and Agility Healthcare.

UPDATE, TAKE TWO (12:30pm PT): Added items on AM Pharma, Milestone Pharmaceuticals and ChanTest.