Seattle-based Adaptive TCR, a startup that grew out of immune-system profiling work at the Fred Hutchinson Cancer Research Center, has raised $5.8 million in an equity investment round that could be worth as much as $7.5 million over time.
Adaptive TCR, profiled in these pages back in December, has secured the new financing from a group of wealthy individuals, according to CEO Chad Robins. He’s not naming names, although a filing with securities regulators says that 63 accredited investors participated in the round, and Robins said none are venture capital firms. This is the second notable cash infusion for the company, got up and running with its first $4.5 million in March 2010.
The investors are betting here on a big new idea that uses fast/cheap DNA sequencers, cloud computing infrastructure, and proprietary software. Those tools, taken together, are used to analyze a bewilderingly complex set of data on how a patient’s immune system has gone awry, or how it’s effectively responding to viral or bacterial invaders. So far, Adaptive TCR has found a market for this kind of tool, assembling a roster of more than 50 customers from academic research centers in its first year.
Lately, the business has been adding new customers at the rate of almost one per day, Robins says. That kind of momentum enabled the company to raise the new capital, which it plans to use for developing the technology into a new kind of diagnostic test for various forms of cancer or autoimmune disease.
“What we have is like the MRI for the immune system,” Robins says. The financing, he says, “will allow us to aggressively grow our brand and platform and emerge as a dominant player in the next-gen sequencing immune profiling space.”
Adaptive TCR isn’t disclosing how well it’s doing in terms of sales just yet. It has grown to 14 employees, and, while it isn’t yet profitable, it could get to that point by late 2011 or early 2012, depending on how much it chooses to invest in R&D, Robins says.
The size of the market is really anybody’s guess since this is a new niche, and there are only a few emerging players besides Adaptive TCR, such as San Francisco-based Sequenta. The opportunity will depend on which diseases Adaptive TCR sets out to diagnose. Robins wouldn’t say which forms of cancer or autoimmunity the company has in mind.
Adaptive TCR’s biggest fans are early adopters in the biomedical research community, Robins says. While the company hopes to publish eight to 10 academic research papers of its own this year, to show what its ImmunoSEQ system can do, the technology could get an even bigger boost from what those scientists do with it on their own, he says. About a half dozen influential scientists have submitted papers to top scientific journals on discoveries they have made with the Adaptive TCR system, and the company has increasingly been cited for its work at scientific meetings, Robins says.
What this tool is supposed to do is something that nobody really thought seriously about until DNA sequencing got super-fast and super-cheap, as did cloud computing infrastructure.
A little science is required to get the gist. While the 3 billion letters of DNA that make up a genome are consistent in almost every cell of the body, the immune system’s B cells and T cells are an exception. In these cells, DNA gets flipped around in a wild array of combinations, allowing T cells to recognize specific invaders, such as flu viruses, and bacteria, and allowing B cells to generate antibodies against them.
Scientists have traditionally looked to assess immune responses by looking at generalized markers of inflammation like C-reactive protein, or through gathering blood samples and counting certain immune cells like those with CD4 receptors. But until recently, they could never really look at the vast diversity of an individual’s immune system in a specific way that could say how the immune system as a whole reacted to infection with a specific bug, or adapted in response to a certain vaccine or therapy. There was no real way to quantify how strong or weak an individual’s immune repertoire is.
The technology has its roots in work done by Harlan Robins (Chad’s brother), and Chris Carlson—a pair of young faculty members at the Hutch. The initial enthusiasm among their scientific peers has started to spill over to clinical researchers, like those who treat patients, which is why Chad Robins traveled this past weekend to Chicago to meet with doctors at the American Society of Clinical Oncology meeting. Further behind in the adoption curve, he says, are biotech and pharma companies that are looking for ways to predict which patients will or won’t respond to new drugs in clinical trials—as a way to save time, money, and reduce the risk of failure in clinical trials.
More news will be coming soon, Robins says, as he hopes to add a couple of important new members to the board. For now, the public record shows Adaptive TCR has just three board members—Chad Robins, Andy Zoltners, a marketing professor at Northwestern University’s Kellogg School of Management, and Craig Weissman, the chief technology officer of Salesforce.com. Robins isn’t quite ready to say who else will be joining the board, but he said H. Stewart Parker, the well-known CEO of the Seattle-based Infectious Disease Research Institute, has been advising the company.
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