Idec Will Get $8.5 Million for AIDS Research From N.Y. Life
New York Life Insurance Co. will pump $8.5 million into Idec Pharmaceuticals to finance research into therapeutic drugs for the treatment of AIDS and AIDS related complex, Idec President William H. Rastetter said Monday.
San Diego-based Idec will use the funding, to be delivered over four years, to expand existing research into therapeutic products for AIDS patients, Rastetter said, adding that clinical testing could begin in 1990.
In exchange for the funds, New York Life will receive warrants to purchase shares of Idec and a royalty right on the sales of diagnostic and therapeutic drugs.
Idec hopes to develop drugs to modify the balance of natural components within the body’s immune system. That process would bolster the body’s natural ability to combat AIDS and ARC, Rastetter said.
Idec approached New York Life’s investment group with a funding proposal several months ago, he said.
“We have tried to build our business by retaining product manufacturing for ourselves,” Rastetter said. “We view the insurance industry as a group that obviously has a lot to gain from AIDS-related products, but as far as we can see, they’ve got no interest in selling products.”
A New York Life spokesman was not available for comment Monday. But Rastetter suggested that “the investment has some strategic importance” for New York Life because of its future exposure to AIDS-related claims.
In a related announcement, Rastetter said Idec has completed a $10.8-million venture capital round that brought in six new investment groups. The company, which now has attracted $30 million in venture funding, declined to identify the new investors.
Rastetter said the latest round was completed at a price of $3.25 a share, up from $1.75 in a private offering completed in the wake of the Oct. 19 crash.
