FDA Approves Over-the-Counter Version of Santarus Drug, Pioneer of Algal Biofuels Says Algae Will Make Drugs Too, Receptos Gets $25M, & More San Diego Life Sciences News

Xconomy San Diego — 

San Diego’s biotech news picked up in pace following the Thanksgiving holiday, with Phenomix announcing a major partnership, Santarus benefitting from FDA approval of its over-the-counter heartburn drug, and Receptos getting a VC infusion. Our Xconomy post-holiday news feast is ready, so come and get it:

—After forming a partnership last year with New York-based Forest Laboratories, San Diego’s Phenomix says Italian pharmaceutical company Chiesi Farmaceutici has agreed to help commercialize its diabetes drug in Europe and elsewhere. Chiesi has agreed to pay Phenomix as much as $163 million if all milestones are met, including $28 million in near-term cash and equity.

—Prominent algae biologist Stephen Mayfield, a co-founder of San Diego’s algae-to-biofuels startup Sapphire Energy, told Denise that algae could become just as important to the biotech industry as it is now with the renewable energy industry. Mayfield, who also founded Rincon Pharmaceuticals, showed earlier this year that algae could be used to produce an anti-anthrax antibody—and other projects are testing the feasibility of using algae to produce anti-tumor drugs and even a malaria vaccine.

—San Diego’s Santarus (NASDAQ: SNTS) said the FDA approved a request by its corporate partner, the Schering-Plough unit of Merck, to start selling an over-the-counter version of its heartburn drug omeprazole (Zegerid). Approval of the lower-dose version of the heartburn drug means that Santarus can collect a $20 million milestone payment, and is eligible to get additional payments based on sales.

Receptos, a San Diego-based biotech with a new way of taking the guesswork out of drug discovery, is the recipient of $25 million in venture capital from Arch Venture Partners, Flagship Ventures, Lilly Ventures, and Venrock Associates. Receptos also got something else from Venrock: Bill Rastetter, a Venrock partner who was the CEO of Idec Pharmaceuticals before it merged with Cambridge, MA-based Biogen, has joined Receptos as CEO.

—San Diego-based Ocera Therapeutics may have a drug for treating hepatic encephalopathy, a complication among people with cirrhosis of the liver that causes ammonia levels to build up in the bloodstream, eventually causing cognitive disorders. The company has raised $62 million in three rounds of financing from a group of prominent VC firms—including Domain Associates, Sofinnova Ventures, InterWest Partners, and Thomas, McNerney & Partners.

—Luke has been extremely enthusiastic about the speakers he’s recruited to speak about biotech innovators and innovation at Xconomy’s Dec. 14 event in San Diego. The afternoon session includes talks by Caltech’s David Baltimore, the Nobel Laureate and a co-founder of Carlsbad, CA-based Helixis, and John Maraganore, the CEO of Cambridge, MA-based Alnylam Pharaceuticals (NASDAQ: ALNY). Check out the full list of speakers, and register online here. It will be a great networking opportunity and we want to see you there.