France’s Poxel, a diabetes specialist spun out of Merck Serono, has raised 16 million euros in a series A round of financing.

Much of the cash, which came from investors such as Edmond de Rothschild Investment Partners and the InnoBio fund, will be used to advance the Lyon-based company's Iead programme imeglimin, an oxidative phosphorylation inhibitor, to treat type 2 diabetes.

Poxel’s chief executive Thomas Kuhn said the substantial funding, which is the largest series A financing round in France since 2005, “is very encouraging and is a real testimony to the potential of our company”. He added that the money will help us advance our product pipeline and specifically demonstrate imeglimin's clinical potential, both as monotherapy and in combination.

Imeglimin is a first-in-class oral anti-diabetic that has demonstrated efficacy and safety in two Phase IIa trials. It targets the three key defects of type 2 diabetes, inhibiting hepatic gluconeogenesis, increasing muscle glucose uptake and restoring normal insulin secretion.

Poxel noted that it has five further promising anti-diabetic programmes including a new class of direct AMPK activators close to preclinical development stage.