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Dr. William Freytag
President & CEO
Myogen, Inc.
(NASDAQ: MYOG)
The Background
When Dr. William Freytag was appointed CEO of Myogen, he recognized that the firm’s novel clinical approach would not produce shareholder value for many years.
Carefully analyzing the state of the pharmaceutical industry, he recognized that companies were merging in unprecedented numbers. The net result would be that many discoveries would not be brought to market because of competing interests within the newly formed companies. He concluded that Myogen could see great success by applying parallel strategies that used their extensive knowledge to both develop products and to in-license compounds big pharma had left on the shelves.
Why We Invested
Thinking big inspires greatness. From the start, Myogen’s focus was on the leading killer of Americans – cardiovascular disease. Big plans require financial partners who share the vision and have the wherewithal to carry out the plan.
One of Myogen’s original investors, Arnie Oronsky at Interwest Partners, introduced Dr. Freytag to NEA Partner Sigrid Van Bladel. A scientist with a PhD in molecular biology, Sigrid immediately recognized that their strategy was not only timely, but that Myogen had the right staff to carry it off.
The Result
NEA led the $18 million B round and helped set the cornerstone of the company.
Then, with their first compound in clinic, Myogen licensed a second and with encouragement from NEA, a third was brought to clinical trial. With their Phase III research set (and projected to be the most expensive yet), NEA arranged the second largest funding seen that year – $66.4 million – which was led by JP Morgan Partners. Ultimately, NEA played a critical role in Myogen’s IPO.
Why It Worked
NEA had the rare combination of vision and deep pockets to finance this ambitious endeavor. At a critical time, with Myogen facing a challenging market with low cash reserves, NEA raised funds to shore up their financial position and move the company through trials.
Their IPO provided promise and a clear message to fellow biotech companies. Even in a difficult environment, an IPO is achievable if there is substance to your company and you have a management team and financial partners who can truly think big.
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