A New Jersey foundation that funds research coming out of the state’s medical school has agreed to replenish its investment arm with $5 million to pump into biotechnology startups at the pre-seed stage — one of the most difficult stages for companies to get funding.
The New Jersey Health Foundation’s Foundation Venture Capital Group in New Brunswick, New Jersey invests up to $500,000 in pre-seed stage companies spinning out of the University of Medicine and Dentistry of New Jersey. It is poised to close its 10th investment deal from the fund initially set up in 2006.
The pre-seed stage is a tough time for biotechnology companies to scrape up funding with many investors waiting until a company’s technology is in clinical trials before allocating capital.
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Foundation Venture Capital Group has focused its investments solely on commercially viable technology vetted by the technology transfer office at the University of Medicine and Dentistry of New Jersey. A merger with Rutgers University in July is imminent, so the foundation’s funding remit could be expanded to include investment in Rutgers biotech startups as well.
Foundation Venture president James Golubieski said sometimes it will give a company or researchers suggestions on what they need to do to make their concept more commercially viable and invest in them one year later. In addition to investment, the venture group also helps companies with the business of setting up a company and help them manage some of their business affairs.
Last year it invested in New Brunswick, New Jersey-based GeneAssess, a biotech developing a diagnostic biomarker to detect breast cancer. It will also be used to detect genetic mutations in at-risk populations. This month it also invested in a company developing a drug for Parkinson’s Disease patients to cure the involuntary movements that can result from longterm use of LDopa called MentaNova Another company in which it has invested, Durin Technologies, created a biomarker blood test for Alzheimer’s Disease and Parkinson’s Disease.
Asked if he had noticed any emerging trends, Golubieski said more corporate partners are showing interest in technology right now, particularly regarding license arrangement. He added that it is seeing stronger candidates than in previous years.
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Among the other companies in which the venture group has invested, according to the announcement, are:
- Actinobac Biomed is developing a therapeutic targeting blood cells for the treatment of hematological malignancies such as leukemia and lymphomas.
- Affineti Biologics is advancing research in the development of therapeutic and diagnostic products based on new discoveries in oral biology and dental medicine.
- CellXplore is developing biomarker-based in vitro diagnostic assays for cancer.
- Celvive is developing technology to treat patients with chronic spinal cord injuries with their own adult stem cells.
- Longevica Pharmaceuticals is developing a chemoprotective agent that may keep normal cells healthy during cancer treatments (FVCG’s equity interest in Longevica was sold to Rostock International, a subsidiary of a Russian global investment firm.
- Snowdon Pharmaceuticals, a drug discovery company focused on several major therapeutic areas.