It’s not that I thought Vermont and New Hampshire were technological backwaters, because I knew from my years of working in Boston that the local venture capitalists were pumping millions of dollars into startups in the two northern New England states. But what I’ve found over the past year or so of living in both Vermont and the Boston area is that the only thing that really separates the startups in Kendall Square from those in Barre, VT, and Lebanon, NH, is that the former are way closer to good seafood. The level of innovation and sophistication among the entrepreneurs in both camps is pretty much equal.

While attending a business and innovation event called Vermont 3.0 in Burlington, VT, last week, I thought it would be fun and interesting to take a look back at all the northern New England innovation I’ve covered over the past year. Indeed, a perk of working north of the Massachusetts border is that I’ve visited the laboratories and research facilities of many exciting startups up here. I’ve had a chance to visit with faculty and researchers affiliated with innovation hubs such as Dartmouth College, Middlebury College, and the University of Vermont. I’ve also talked shop with venture capitalists at firms such as Borealis Ventures, based in Hanover, NH, and FreshTracks Capital in Shelburne, VT.

What follows are summaries of the northern innovation stories I’ve written for Xconomy in the order in which they were published. For each story description I dug into my notes and tried add something that wasn’t in the original piece (but I’m not one to withhold interesting details from my posts, so the supply of previously unreported material was a bit thin).

My plan is to dig deeper into the pockets of innovation north of Boston over the next year. But make no mistake, the majority of my stories will still emanate from the Hub.

—In northern New England, there are no technology clusters as dense as those found in Boston, but I found an emerging innovation cluster in Dartmouth College and environs earlier this year. My trip to Dartmouth in February resulted in a post about the key labs, people, and concerns that contribute to the startup ecosystem there. (I also learned that parking is as difficult to find on the Dartmouth main campus as anywhere in Cambridge, MA.)

—People may assume startups in New Hampshire operate in small buildings nestled in the woods, and in the case of Lebanon-based antibody discovery firm Adimab, those people would be right. I met the founder and CEO, Tillman Gerngross, at the Dartmouth Regional Technology Center, an incubator that hosts Adimab and other firms with ties to Dartmouth College. Gerngross, an engineering professor at Dartmouth, pointed out that a firm called GlycoFi that he co-founded and sold to Whitehouse Station, NJ-based drug giant Merck (NYSE:MRK) in 2006 was operating in separate labs in the same building.

—One of the first stops that startups make to find money in Hanover is Borealis Ventures. Borealis has done well investing in Dartmouth spinouts; its investment in GlycoFi alone made its first fund a big success, firm co-founder and managing director Phil Ferneau told me during a meeting. While there are many angel investors in New Hampshire, Borealis may be the only venture capital firm in the state. So, as you’d imagine, Ferneau and his partners are very popular among entrepreneurs in the state.

—After meeting with Gerngross and Ferneau, I wondered what exactly was under the hood at GlycoFi that would persuade Merck to maintain its operations in New Hampshire. It turned out that GlycoFi’s technology—which involves the use of bioengineered yeast to produce human proteins with lower structural variability than mammalian cell lines typically yield—is a centerpiece of Merck’s recent strategy to develop copies of biotech drugs. And many of the scientists who are developing the GlycoFi platform still reside in northern New England.

—Apparently, I’m not the only Boston-area innovation junkie who’s working in Vermont. John Danner, the CEO of Northern Power Systems in Barre, VT, told me during a meeting at his office that his primary residence is still in Massachusetts even though he spends most of his weeks in the Green Mountain State. Danner, a former engineer aboard nuclear submarines, is now engineering a turnaround at the Vermont-based wind turbine manufacturer. (The latest on Northern Power is that it’s aiming to …Next Page »

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Virdante Pharmaceuticals is expanding development of its anti-inflammatory drugs with a second closing of what is now a $30 million Series A round of venture capital, the company’s CEO, John Ripple, said. The Cambridge, MA-based biotech startup has found potential ways to boost the anti-inflammatory effects of conventional antibody drugs and to create novel therapies to treat diseases in which the immune system attacks healthy tissue.

Investors have committed up to $47.75 million for the first-round financing, agreeing to add nearly $18 million to the $30 million already raised by Virdante if the company achieves certain milestones, Ripple said. Venture firm Thomas, McNerney & Partners led the second closing of the round, which included investments from new backer Osage Partners as well as previous investors Biogen Idec New Ventures, Clarus Ventures, MedImmune Ventures, and Venrock Associates. Eric Aguiar, a partner at Thomas, McNerney, is also joining the board of directors at Virdante as part of the financing, according to the company.

This large round of financing is a big boost for Virdante’s new method of adding a specific sugar molecule to antibodies to increase their ability to tamp down excess inflammation, while at the same time maintaining the immune system’s natural defense against infection. The first program under development is to increase the anti-inflammatory effects of antibody infusions used to treat diseases such as cancer, HIV, and a bevy of autoimmune diseases in which the body’s immune system goes haywire and starts attacking healthy tissue like it would a virus. These so-called intravenous immune globulin (IVIG) treatments grossed $4 billion in 2008 for drug makers such as Deerfield, IL-based Baxter Healthcare and King of Prussia, PA-based CSL Behring, Ripple said. Virdante wants to make these antibody infusions more potent to reduce how much of the treatments patients need to take and how long it can take to inject the drugs from a few days to several hours.

Virdante plans to make its IVIG with traditional supplies of the treatment derived from human blood, using an extra step in the manufacturing process that incorporates an enzyme that improves the potency of the antibodies. The demand for IVIG is bigger than many people realize. Ripple said that while the therapy is approved by the FDA for several disorders, the antibody infusions are used to treat more than 100 different diseases including non-approved uses such as treating multiple sclerosis and Alzheimer’s. A concern is that demand will eventually exceed supply. “One of the exciting opportunities for [our IVIG product] is that it promises to significantly reduce the therapeutic dose,” he said, “so we can use the same current supply of IVIG and treat many more patients with that same supply.”

Virdante’s technology is based on the discoveries of Jeffrey Ravetch at …Next Page »

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Boston is an international hotbed of biotech research. So why would a company called Boston BioCom specialize, as it does, in bringing biomedical discoveries to the Hub from Russia?

To hear the folks at Boston BioCom tell it, Russia has some biotech brawn of its own. New York-based drug giant Pfizer (NYSE:PFE) invested $10 million in the Boston-based firm in summer 2008 to help it tap Russia for life sciences discoveries that could be commercialized in the US and elsewhere. And the company has already established two programs to bring science from Russian institutions to market.

Why Russia? Jeffrey Gelfand, chief scientific officer of Boston BioCom and a physician at Massachusetts General Hospital, said that the U.S. State Department began pumping hundreds of millions of dollars into Russian institutions after the fall of the Soviet Union to redirect the efforts of former weapons scientists to medical and non-defense pursuits. Though the U.S. has wound down this funding as the Russian economy has strengthened, the resulting biomedical discoveries from the research makes Russia a viable source of medical technology.

Gelfand isn’t making this up. In San Francisco, a biotech called Medivation (NASDAQ:MDVN) is in late-stage clinical development of an antihistamine drug from Russia to treat Alzheimer’s disease. Also, ProTom International, based in Flower Mound, TX, is developing next-generation proton therapy systems for cancer treatment based on technology licensed from the Lebedev Physics Institute in Moscow. ProTom researchers have collaborated with scientists from MIT’s Bates Linear Accelerator Center in Middleton, MA, to enhance the system.

“I think [ProTom] is a perfect example of what we hope to do ourselves,” Gelfand said.

Boston BioCom has three main biomedical technologies in development, two of which stem from discoveries in Russia, while the third is from Gelfand’s own lab at MGH. The Russian-born technologies include a laser energy system, which is designed to boost immune responses in the skin, and an antibacterial therapy program, which is focused on using molecules called bacteriocins as drugs. (In nature, bacteria produce bacteriocins to fend off attacks from other bacteria.) The firm’s program from Gelfand’s lab involves the use of engineered antibodies—in this case, monoclonal antibodies fused with recombinant heat shock proteins—to treat cancer and infectious diseases.

The firm licensed the bacteriocin technology from …Next Page »

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In the past week, the Northwest has seen its share of debt financings in medical devices and bio-IT, small funding deals and partnerships in Internet software, and mounting interest in an impending IPO.

—Amazon (NASDAQ: AMZN) rolled out a new mobile payments service that lets applications developers and distributors tap into the e-commerce giant’s one-click checkout system on mobile devices. As part of the rollout, Amazon has formed partnerships with mobile content distributors like Kansas City, MO-based Handmark, which sells games, apps, ringtones, and the like. Financial terms were not given.

—Seattle’s Theraclone Sciences formed a partnership with Tokyo-based Zenyaku Kogyo, worth up to $18 million over time, to discover antibodies that could protect millions of people in a flu pandemic, as Luke reported. Under the deal’s terms, Theraclone has given Zenyaku an option for exclusive rights to new flu antibodies in certain Asia-Pacific countries, while Theraclone gets an undisclosed amount of upfront cash and royalties on future product sales in Zenyaku’s territories.

—Seattle-based Omeros, the developer of anti-inflammatory treatments and other biotech therapies, is on the docket to go public this week and raise more than $80 million, as Luke reported. The company is also defending itself against accusations from its former chief financial officer that it filed false records with the National Institutes of Health and then wrongfully terminated him after he reported it to the board’s audit committee under the company’s whistleblower policy.

—Seattle-based Teranode raised $900,000 in debt financing, as Luke reported. The investors weren’t disclosed, although Bellevue, WA-based Ignition Partners has invested in the past. Teranode, a maker of software to organize life sciences labs, was founded in 2002 out of the University of Washington.

—Seattle-based Founder’s Co-op, a seed-stage investment organization, has backed two local Internet startups, Nearlyweds and BigDoor Media. Financial details of the deals were not announced, but Founder’s Co-op says it typically invests $250,000 or less in its portfolio companies.

—Redmond, WA-based Spiration raised $7 million in debt financing out of a $10 million offering, as Luke reported. The financing came from the company’s partner in Europe and Japan, Olympus Medical Systems. Spiration, which makes an implantable device to treat deadly lung diseases like emphysema and chronic bronchitis, has raised about $97 million since its founding in 1999.

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Ambrx has ginned up yet another potentially lucrative Big Pharma deal. The San Diego-based biotech company has struck a worldwide partnership with Madison, NJ-based Wyeth to create new engineered antibody drugs against multiple diseases.

Financial terms aren’t being disclosed, but Ambrx says it is raking in an upfront payment, research funding, milestone payments based on progress developing drug candidates, as well as royalties on sales of work that translates into marketed products. This deal, combined with Ambrx’s partnerships with three other major drugmakers, means that Ambrx now has enough cash in the bank to operate “multiple years” without seeking additional financing, according to CEO Steve Kaldor.

“We have no lack of interest in the company,” says Kaldor, who adds that he had talks with five different prospective partners before settling on Wyeth in the latest alliance. “We’ve actually been turning down deals.”

The Ambrx story began back in 2003. That’s when Peter Schultz, director of the Genomics Institute of the Novartis Research Foundation (and the founder of eight biotech companies) had a new idea for creating new amino acid building blocks for a different class of biotech drugs. These drugs could potentially do whatever you wanted, like last longer in the body, or carry potent cell-killing agents. That work has enabled Ambrx to raise about $106 million in venture capital, build a scientific team of about 80 people, and score five different partnerships with three other major drugmakers to date—Merck, Eli Lilly, and Merck KGaA of Germany.

Ambrx’s two best-known drug candidates are designed to be longer-lasting versions of protein drugs that treat growth deficiencies and multiple sclerosis. But Wyeth, a major drug maker that’s in the process of being acquired by Pfizer (NYSE: PFE), was interested in something new that emerged at Ambrx …Next Page »

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Our Seattle compatriots have all arrived in Boston for XSITE. We wish we could say they brought the rain with them, but in fact, Boston has been far wetter than Seattle all month. The week’s life sciences news, however, isn’t quite the downpour you’ve all been dealing with outside.

—Wide-roaming correspondent Ryan McBride took in some sea air while attending the Convergence conference in Newport, RI. Policy wonks abounded, as the health care industry is nervously awaiting changes to federal patent standards, generic biotech drug regulation, and healthcare coverage. Ryan gathered insights on GlaxoSmithKline (NYSE: GSK)’s purchase of Cambridge, MA-based Sirtis last spring from Genzyme (NASDAQ: GENZ) CEO Henri Termeer’s account of a conversation he had with Sirtis CEO Christoph Westphal. For all this and more, check out his report.

—Ryan also profiled PubGet, a Cambridge-based scholarly search engine aiming to provide faster, more useful results than the likes of GoogleScholar and PubMed. Instead of clicking through multiple links to get to the paper, a PubGet search will take you directly to a full-text PDF (assuming your institution has access). PubGet’s just announced that 50 research institutions have adopted its service.

—Marlborough, MA-based Exact Sciences is going back home to where the buffalo roam. The colorectal cancer test maker is relocating to Wisconsin after securing a $1 million loan from the Badger State.

—ImmunoGen (NASDAQ: IMGN), which produces technology to aid the effectiveness of antibody drugs, raised $33 million, after expenses, through a stock offering. The Waltham company sold 5 million shares at $7 apiece.

—Cambridge’s Living Proof, which aims to apply advanced materials science to beauty products, raised $9 million in an equity financing round. The funds came from Polaris Venture Partners, the sole venture backer of the company. Living Proof recently debuted its first product, the hair treatment NoFrizz.

—I-Therapeutix, a Waltham-based maker of tiny hydrogel-based eye bandages, landed $15 million in venture capital during a Series C Financing round. Between this latest news and the recent clearance of its flagship product, the I-Zip bandage, in European markets, I-Therapeutix is sitting pretty. The company hopes to enter the American market early next year, and is currently batting its lashes at the FDA.

—Norwich Ventures sounds like a great boss to work for. The Waltham venture firm loves to invest in medical device companies at an early stage, and unlike other, larger players, doesn’t pressure companies in its portfolio to sell or exit within five years. Hear more about their strategy in Ryan’s piece here.

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Celldex Therapeutics (NASDAQ:CLDX), a Needham, MA-based developer of drugs that harness the power of the immune system to treat diseases, says that it has struck a deal to acquire CuraGen (NASDAQ:CRGN), of Branford, CT, in an all-stock transaction that values CuraGen at $94.5 million. Celldex expects to gain 11 cancer antibody drugs from CuraGen as well as at least $54.5 million in cash that CuraGen is due to have in the bank at the closing, which is slated for the third quarter of 2009.

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Seattle’s biotech companies must be trying to get a lot done before Memorial Day weekend, because we had reports on deals, layoffs, and big strategic moves.

—Dendreon (NASDAQ: DNDN) has spent years trying to prove that its immune-boosting therapy for prostate cancer really works, and now it has to show it can make enough of it to meet coming demand. The company has just one commercial manufacturing facility, and it is rapidly trying to scale it up over the next 14 months so it can pump out a maximum of $500 million to $1 billion worth of Provenge each year, says CEO Mitchell Gold.

—Archus Orthopedics, the Redmond, WA-based developer of spinal implants that help people remain mobile after back surgery, has laid off most of its employees and significantly scaled back operations to conserve its remaining cash.

—Accelerator, the Seattle-based investment vehicle for biotech startups, bankrolled its 10th company, called Xori. The company raised $2.1 million out of a $4.5 million round, toward a goal of developing technology that will make antibody drugs much more quickly, and with better properties, than existing methods.

—Cancer drugs represent one of the most intense fields of interest in biotechnology, so it shouldn’t be a surprise that a lot of Seattle biotech companies have news coming out at this year’s meeting of the American Society of Clinical Oncology from May 29 to June 2. ASCO posted brief online summaries of a lot of clinical trial data to be presented, and I combed through the most interesting abstracts from companies in the Northwest.

—Bionavitas, a Redmond, WA-based developer of light technology to help algae grow much more efficiently, explained its strategy in this feature story. It sees more promising markets in using algae to make food additives and for toxic cleanup—at least in the early days—than for biofuels.

—I heard about an intriguing new startup called Presage Therapeutics, a spinoff from the Fred Hutchinson …Next Page »

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