Life Science Startups Are Catching Investors’ Attention
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Online and big box retailers aren’t the only ones that are getting an influx of capital this holiday season. Several Indianapolis-based life sciences start-ups have raised considerable funding to continue moving their innovations from the research and development phase to the bedside.
These include two startups in the BioCrossroads’ Indiana Seed Fund III portfolio that are making progress and have had healthy funding raises in the last few months. A few other deals are pending announcements.
Scioto Bioscience, based in Indianapolis, is working on an advanced bacterial therapeutics platform. In August, the company announced the beginning of the Phase 1b clinical trial for their lead investigational product for the treatment of Autistic Disorder. Just a couple of months later, Genome & Company, a leading microbiome company located in South Korea, was the lead investor in a follow-on investment in Scioto with participation by BioCrossroads, Elevate Ventures, IU Philanthropic Ventures, and VisionTech among others.
Genome subsidiary, List Biotherapeutics, recently announced a $125 million investment in Fishers to create a new 110,000 square foot facility). Genome’s investment in Scioto gives them a majority stake and extends their presence into the U.S. Scioto has an exclusive license of the Activated Bacterial Therapeutics Platform which was developed by researchers at the Abigail Wexner Research Institute at the Nationwide Children’s Hospital in Columbus, Ohio.
Additionally, a $15 million investment recently closed for Gate Neurosciences, a biotech company based in Carmel, which is developing therapies for the treatment of central nervous system disorders. Gate is a clinical-stage precision neuroscience company launched in 2019 by a team of serial entrepreneurs, including Derek Small, as Chairman (Naurex, ASMB); Mike McCully, as CEO and President (20+ year biopharma); Ron Burch, Chief Medical Officer (Naurex, Zeneca); Andy Dahlem, as Chief Development Officer (Eli Lilly); and Anantha Shekhar (IU, UPitt). They are developing a portfolio of next generation neuroscience drug candidates licensed from AbbVie, Eli Lilly, and others.
There’s been much more activity than these two examples in 2021, and we will have a final dollar figure in January. What’s important to remember is that funding innovation pays dividends for Indiana. The seed fund strategies implemented by BioCrossroads, universities and other local stakeholders in the life sciences community have seen positive investment returns, and more importantly, the attraction of many times that investment including capital outside the state, a growing tax base, growth of jobs and investment in new facilities.
Twelve years ago, when Dr. Phil Low’s On Target Laboratories was founded, it was supported by early-stage investors to take their research from the university bench to the next phase. Many years and more than $80 million later, the investment, the science and the dedication of their team has paid off. They just received FDA approval for an additional tool for intraoperative identification of malignant lesions in adult patients with ovarian cancer – the first of its kind. On Target Laboratories joins the ranks of Indiana’s successful start-up life sciences companies including Endocyte, acquired by Novartis for $2.1 billion in 2018 and Co-Lucid, acquired by Eli Lilly for $960 million in 2017.
And the next On Target Laboratories, Co-Lucid, or Endocyte just might be one of these companies receiving early stage funding this year.
Nora Doherty is Executive Vice President of Strategy at BioCrossroads.