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Friday, October 13, 2006 - Page updated at 12:00 AM

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Snoqualmie biotech firm halts market foray

Seattle Times business reporter

Light Sciences Oncology


Located: Snoqualmie

CEO: Llew Keltner

Employees: 26

Top shareholders: Craig Watjen (43.5 percent), Essex Woodlands Health Ventures (18.8 percent), Scandinavian Life Sciences (11 percent).

What it does: Developing a drug/device combination for treating solid-tumor forms of cancer.

Cash on hand: $50.7 million, as of June 30

Source: Company filings

Light Sciences Oncology, a small company in Snoqualmie that was a virtual unknown in Northwest biotechnology until a year ago, fell short Thursday in its quest to join the big time.

The company indefinitely postponed its initial public offering on the Nasdaq Global Market after trying for two weeks to get Wall Street fired up to buy its shares. The company had hoped to sell 5.25 million shares for $14 to $16, which could have raised $84 million for its research and development against cancer.

Company officials declined to comment.

Despite enthusiasm that drove brand-name stocks on the Dow Jones industrial average to a record-high Thursday, investors have not been as hungry for speculative biotech companies that are years away, at best, from delivering money-making products.

This year, there have been 176 IPOs, according to Bloomberg data; 14 have been in biotech, according to Signals, an online biotech magazine. The biotechs have gotten mixed reviews — seven have traded up from their debut, seven down.

Two companies officially withdrew IPOs on Thursday; one in chemicals, one in restaurants. Another biotech, ImaRx Therapeutics, postponed its offering, according to Bloomberg.

Light Sciences Oncology had hoped to spend the new capital on Litx, its drug/device combination therapy against particularly tough-to-treat cancers. The system works by using a light-emitting diode, mounted on a catheter, which doctors can thread inside a solid tumor. The patient then is injected with an inactive chemical drug. Once the light is turned on, it activates the drug to kill tumors within a limited wavelength, sparing surrounding healthy tissue.

Light Sciences Oncology does not have data showing Litx can prolong lives, the gold standard in cancer therapy. The company, which has 26 employees, also does not have a partnership with a major drug or device company, and it intends to rely on outside support for manufacturing, sales and marketing.

In small studies, Litx has slowed down cancer, with "minimal adverse events" in patients, according to the prospectus Light Sciences filed with the Securities and Exchange Commission. The company said it is running a more definitive, 200-patient clinical trial against liver cancer.

Spun out of its parent Light Sciences Corp. last year, the company raised $67 million in venture capital in December. It had $51 million left in the bank as of June 30, according to its prospectus.

Dr. Raymond Yeung, who directs the Liver Tumor Clinic at the University of Washington Medical Center and has no financial ties to the company, said Litx appears easy to use and cheaper than past laser technologies.

Still, he said, it must prove it can compete with other minimally invasive methods for killing localized tumors, such as radiofrequency ablation, microwaves and high-intensity, focused ultrasound.

"I think this will work," Yeung said. "The question is, will it be better?"

Luke Timmerman: 206-515-5644 or ltimmerman@seattletimes.com.

Dow Jones Newswires contributed to this report.

Copyright © 2006 The Seattle Times Company

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