Karolinska Development AB has announced that its portfolio company Dilafor AB has successfully completed a financing round raising SEK 51 million (US$5.9 million) from new and existing investors. New investors include Lee's Healthcare Industry Fund, Rosetta Capital IV and Pila AB. Dilafor’s largest existing shareholder, KDev Investments (an investment fund jointly owned by Karolinska Development (Nasdaq Stockholm: KDEV) and Rosetta Capital, also participated in this round.
As a result of the new financing, Karolinska Development has decreased its indirect holdings via KDev Investments in Dilafor from 53% to 35%. The financing has no impact on Karolinska Development’s Fair value. Dilafor’s lead candidate, tafoxiparin, a modified form of heparin, is in clinical development to decrease the incidence of protracted labor both after induction of labor and after spontaneous onset of labor. Protracted labor (i.e. labor that lasts more than 12 hours) is the main cause of emergency surgical deliveries, such as caesarian section.
The condition is often associated with complications for both mother and child. Tafoxiparin has shown in a Phase II clinical trial encouraging evidence that it can shorten labor time. The successful completion of the financing round enables Dilafor to facilitate a Phase IIb dose finding trial with tafoxiparin trial in Northern Europe, which is planned to start before the year end 2016.
The study will include women with slow progress of labor after a spontaneous onset. Lena Degling Wikingsson, CEO of Dilafor, said: “This planned clinical study is an important event in the clinical development program for tafoxiparin. There is no available treatment today to help these women that have high risk of fetal and maternal complications as a consequence of slow progress and protracted labor. With support of long-term investors, Dilafor has now secured the financial resources needed to reach this next crucial milestone in the development of this promising candidate, and to identify a dose to take forward into the final stages of clinical development.”
Dr. Viktor Drvota, Chief Investment Officer of Karolinska Development, comments: “We are pleased that Dilafor has been successful in attracting these important new investors to support the company through its next value inflection point. This financing also achieves a key objective for Karolinska Development to ensure its portfolio companies have sufficient funding to reach these crucial development milestones while diversifying the shareholder base through syndication.”