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Merck and J&J back StartX; “clinical-trial-in-a-dish” biotech wows at Demo Day

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Stem Cell Theranostics

Two Big Pharma companies, Merck (NYSE:MRK) and Johnson & Johnson (NYSE:JNJ), are the latest partners to sign on to support healthcare startups that come out of Stanford University.

StartX, the accelerator that spun out of Stanford in 2009, said Thursday at its demo day in Palo Alto (which I watched via live stream) that both companies will provide financial support to StartX Med, the leg of the accelerator devoted to health and health IT ventures. Merck will provide strategic guidance and end-user feedback to digital health, data and analytics companies in the accelerator, while Johnson & Johnson will work with the medical device and biopharmaceutical companies.

The new partnerships come on the heels of more new financial support announced by the accelerator last week. Stanford University committed to providing the accelerator with a three-year, $3.6 million grant and also joined up with Stanford Hospital & Clinics to create a venture fund that will invest in StartX and StartX Med companies.

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Two StartX Med companies presented at demo day last night – one new company and one graduated company that returned with some exciting updates.

Stem Cell Theranostics has developed what it calls “clinical trials in a dish,” with the goal of weeding out toxic compounds early in development and saving pharmaceutical companies, patients and hospitals billions of dollars. Particularly, it’s focused on heart disease. The biotech is developing technology that would let researchers grow heart cells in a dish from skin cell-derive pluripotent stem cells. That would give them a cheaper, faster and more accurate way to screen drugs for efficacy and toxicity.

Co-founder Andrew Lee cited Vioxx as an example of why this technology is so important. After being on the market for four years, Merck pulled the arthritis drug from shelves in 2004 because follow-on studies had found that it was linked to higher rates of heart attack and stroke that potentially affected more than 27,000 patients. Lee proposed that Stem Cell Theranostics’ technology would let researchers screen for those kind of effects in pre-clinical studies.

Since graduating from StartX Med, the company has already secured partnerships with several drug companies, he said, and is nearing completion of a Series A.

Medical search engine app MedWhat also presented. Branding itself as a “personal health assistant,” the startup combines open source health information from the CDC, NIH and other sources with natural language processing to answer users’ health questions however they ask them.

For example, someone could type into the app, “I have diabetes and I just became pregnant. What are the risks for my child?” The app’s technology would go to work deconstructing the question and factoring in the user’s age, gender and medical history to provide a direct response. It would also follow up with questions to prompt the user to get a more accurate or comprehensive response. The company already has a few investors but is on the lookout for more, co-founder Arturo Devesa said.

StartX has graduated 109 startups that have raised a combined $200 million+. While the accelerator admits that a few companies have been retired, in the same breath it touts 10 exits, seven of them coming just this year.

[Image credit: StartX]

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Deanna Pogorelc

By Deanna Pogorelc MedCity News

Deanna Pogorelc is a Cleveland-based reporter who writes obsessively about life science startups across the country, looking to technology transfer offices, startup incubators and investment funds to see what’s next in healthcare. She has a bachelor’s degree in journalism from Ball State University and previously covered business and education for a northeast Indiana newspaper.
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