Sutro Biopharma Grabs $36.5M in Venture Deal to Make “Biobetters”
The buzzphrase “biobetter” is starting to catch on, and South San Francisco-based Sutro Biopharma is the latest to cash in on the trend, as one of the companies hoping to develop drugs with nifty new properties that were never seriously considered before.
Sutro is announcing today it has raised $36.5 million in a Series C venture round led by Skyline Ventures and joined by a couple new corporate investors—Lilly Ventures and Amgen Ventures. Existing backers SV Life Sciences and Alta Partners also participated. The company, formerly known by the geeky name of Fundamental Applied Biology, has now raised $59.5 million since it was founded in 2004.
The big idea at Sutro is to develop a new process for making biologic drugs that doesn’t rely on incubating specific strands of DNA inside living cells. Instead, Sutro is crafting a biochemistry-based method in which genetically engineered drugs can be synthesized in a way that’s faster, cheaper, and more consistent—similar to the way classic “small-molecule” pharmaceuticals are made by big companies like Pfizer and GlaxoSmithKline.
While the underlying technology is critical, the aim here is to use this method to make drugs that have better properties. So Sutro really aspires to enter the emerging class of what some people call “bio-betters” which have clear advantages over existing drugs, like Genentech’s souped-up breast cancer antibody, called T-DM1, or Seattle Genetics’ potent new antibody against rare lymphomas. A few other venture-backed companies—San Diego-based Ambrx, Seattle-based Allozyne, and Cambridge, MA-based Eleven Biotherapeutics—are also working to engineer ideal new properties into protein drugs. The market for biologic drugs is estimated to be worth more than $60 billion, according to Ernst & Young.
“The industry has really recognized that biologics are going to be the driving force from a commercial standpoint for the foreseeable future, and there’s a lot of investment in the area,” Sutro CEO Bill Newell says.
Sutro was founded based on technology from James Swartz’s lab at Stanford University. Much of the early work has focused on how to engineer protein drugs so they don’t … Next Page »