Massachusetts’ $1B Life Sciences Plan Pumps $3.4M in Loans into Startups
At a time when early-stage investment dollars are hard to come by, the state of Massachusetts is giving several startups their first taste of the commonwealth’s plan to invest $1 billion in the life sciences industry over a 10-year period. The Massachusetts Life Sciences Center, the agency in charge of implementing the $1 billion plan, is revealing today that it has awarded $3.4 million in loans to seven life sciences startups.
These startups will likely require millions of dollars more to bring new drugs, devices, or other products to the market. The loans are meant to help startups do early research to show that their experimental products have a shot at working—and the state hopes they’ll also make venture capitalists and other institutional investors more willing to pump in their own capital.
The Massachusetts-based startups selected to receive the state loans are all firms that have yet to close a round of venture capital. In all but one case, these startups are receiving $500,000 loans that are due to be paid over five years with an annual interest rate of 10 percent, agency spokesman Angus McQuilken tells me. (One of the seven loan winners, medical devices developer Wadsworth Technologies, is borrowing $400,000 from the state program because that’s the loan amount it requested.)
The state plans to make multiple rounds of such loan awards per year, he adds. The state also launched a program last year to attract institutional investors such as large life sciences companies to provide matching funds for the program, and the first company to participate is healthcare products giant Johnson & Johnson (NYSE:JNJ), which has agreed to contribute $500,000 to the program over a two-year period.
Here’s the roster of the loan recipients, described in the words of the Massachusetts Life Sciences Center.
Eutropics develops drugs for treating aggressive forms of myeloma, lymphoma, leukemia, and other cancers. The company’s initial target is myeloid cell leukemia-1, a key member of the Bcl-2 family of proteins, which are thought to be involved in resistance to conventional forms of cancer treatment. The firm has identified an early lead compound that selectively inhibits the activity of myeloid cell leukemia and is effective in a lab mouse with B-cell lymphoma.
Good Start Genetics—Boston
Good Start Genetics is a molecular diagnostics company utilizing a proprietary process developed by team members from biotech luminary George Church’s lab at Harvard Medical School. The startup is working to develop a low-cost, pre-pregnancy test for 50 genetic disorders that will replace single-disorder tests currently on the market, which would give parents early information to help ensure healthy children. The firm aims to offer a sequencing-based test that is more accurate, more comprehensible, and more affordable than today’s standard tests.
InVivo Therapeutics—Cambridge, MA
InVivo is a medical device company targeting the market for treating traumatic spinal cord injuries with technology based on research by MIT inventor Bob Langer and Jay Vacanti, a physician at Massachusetts General Hospital and Children’s Hospitals in Boston. The firm’s technology (which Xconomy covered last year) is intended to treat traumatic spinal cord injury by utilizing biomaterials with combinations of drugs and cells. The firm is currently conducting a second round of non-human primate trials and has requested Food and Drug Administration permission to embark on human trials within the year.
Pluromed is pioneering injectable plugs to improve outcomes in cardio-thoracic surgery. The firm received the 2008 European Association of Cardio-Thoracic Surgery Techno-College Innovation Award for the most important technological breakthrough in any area related to thoracic and cardiovascular surgery for its LeGoo Internal Vessel Occluder. Pluromed plugs are based on “reverse thermosensitive” polymers that are liquid at low temperatures and gel at body temperature; these plugs are completely reversible via cooling and completely dissolvable. When injected into the body, the plugs block off blood flow to provide surgeons with a bloodless field. When cooled, the plugs liquefy and dissolve into the bloodstream. Unlike competing technologies, Pluromed’s plugs allow surgeons to remove a tumor while normal blood flow is maintained in the rest of the organ.
Spectra Analysis—Marlborough, MA
Spectra is a supplier of molecular spectroscopy systems and applications for chromatography. Its current products focus on real-time connection of infrared spectroscopy to gas and liquid chromatography. The firm’s DiscovIR systems make it possible to collect full infrared spectra for each component in a separation, either as a standalone or in parallel with mass spectroscopy.
Wadsworth Technologies—Westborough, MA
Wadsworth is a medical device entity targeting the wound closure market. Wadsworth uses next-generation adhesives combined with intelligent engineering to form a painless system that can be rapidly placed with optimal healing results. Its lead product, the “Dermaloc Wound Closure System,” applies tension to skin wounds to close them without anesthesia or sutures, resulting in a novel, painless, rapid, needle-free, and durable wound-closure product. The system is currently in clinical testing.
Wolfe Laboratories— Watertown, MA
Wolfe Laboratories provides assay development, formulation development, process development, and other services to the biotechnology and pharmaceutical industries. Wolfe Labs offers a variety of pre-clinical services, including pre-formulation and formulation development, analytical method development and characterization, among several other services. Wolfe hopes to use the state loan to help build a new manufacturing facility focused on aseptic fill finish services and the manufacture of innovative biologic and cytotoxic drugs. The Boston Chamber of Commerce named Wolfe Labs founder Janet Wolfe as Boston’s Entrepreneur of the Year in 2008.