Justin Klein and Kirk Nielsen. (Credit: Jeffrey Graetsch)

Co-found­ed by Ver­sant, NEA in­vestors, new medtech VC firm kicks off in­au­gur­al fund with $225M boun­ty

In an era where medtech doesn’t get the same love that biotech does from the av­er­age in­vestor, two medtech-fo­cused in­vestors from a pair of key­stone ven­ture cap­i­tal firms — Ver­sant Ven­tures and New En­ter­prise As­so­ci­ates (NEA) — are com­ing to­geth­er to bridge the gap in pri­vate mar­ket cap­i­tal for the un­der­served sec­tor.

Launched this year, the VC in­vest­ment firm — called Ven­sana Cap­i­tal — closed its in­au­gur­al fund, Ven­sana Cap­i­tal I, with $225 mil­lion in com­mit­ted cap­i­tal from a cadre of in­sti­tu­tion­al in­vestors, in­clud­ing pub­lic pen­sions, uni­ver­si­ty en­dow­ments, foun­da­tions, lead­ing aca­d­e­m­ic health sys­tems, fam­i­ly of­fices, and fund-of-funds, it said on Wednes­day.

Co-found­ed by Ver­sant’s Kirk Nielsen and NEA’s Justin Klein, Ven­sana’s fo­cus will be on the kalei­do­scope of sub­cat­e­gories that con­sti­tute medtech: med­ical de­vices, di­ag­nos­tics and da­ta sci­ence, drug de­liv­ery, dig­i­tal health, and tech-en­abled ser­vices.

“I think one over­ar­ch­ing theme for many prod­ucts we in­vest in is try­ing to move them from the more ex­pen­sive side of care, to the less ex­pen­sive,” Nielsen not­ed in an in­ter­view with End­points News.

For ex­am­ple, de­vices that can com­mu­ni­cate with physi­cians or oth­er providers to iden­ti­fy pa­tients that are at risk for be­ing ad­mit­ted with heart fail­ure, or COPD. An­oth­er op­por­tu­ni­ty is about ad­dress­ing chron­ic dis­eases, where pa­tients aren’t nec­es­sar­i­ly com­pli­ant or ther­a­pies have side ef­fects that pre­vent adop­tion.

“We like the idea of iden­ti­fy­ing sur­gi­cal strate­gies, neur­al mod­u­la­tion based strate­gies or oth­er medtech-based in­ter­ven­tions that can ef­fec­tive­ly treat the un­der­ly­ing con­di­tion,” he said.

Al­though Ven­sana is an in­de­pen­dent firm, Ver­sant will pro­vide sup­port. Shar­ing deal flow can ex­tend the op­por­tu­ni­ties that emerge at the in­ter­sec­tion of the two strate­gies — such as drug de­liv­ery or di­ag­nos­tics, Nielsen added.

Nielsen, who was once a pro­fes­sion­al hock­ey play­er and has pre­vi­ous­ly worked with Medtron­ic, has been with Ver­sant for over a decade and was in charge of the firm’s medtech prac­tice.

In biotech — where Ver­sant op­er­ates — in­vest­ment is large­ly fo­cused on ear­ly-stage com­pa­ny cre­ation. In medtech, the op­por­tu­ni­ty lies in mid-to-late stage op­por­tu­ni­ties, he said.

“Most medtech com­pa­nies are best po­si­tioned to go pub­lic or be ac­quired in a com­pet­i­tive process for the time when they’ve re­al­ly demon­strat­ed the adop­tion of their prod­ucts by clin­i­cians, sur­geons and hos­pi­tals,” Ven­sana’s oth­er founder, Klein, em­pha­sized. Klein served as a part­ner at NEA for more than 12 years.

“Be­cause of the time­lines, cap­i­tal re­quire­ments as­so­ci­at­ed with nav­i­gat­ing the ear­ly-stage con­cept all the way through to a scal­ing US rev­enue stage busi­ness, it’s of­ten been the case that (…) some of the most com­pelling in­vest­ment rounds of fi­nanc­ing from medtech com­pa­nies have come kind of more mid­stream in that process.”

Ven­sana wants to cap­i­tal­ize on a rel­a­tive­ly healthy macro en­vi­ron­ment for medtech.

“If you look at the ex­it mar­kets in medtech, they’ve been re­al­ly strong, and you’ve got M&A (…) that con­tin­ues to have kind of a sol­id, con­sis­tent pace, you’ve got IPO win­dows that are now open, and (…) mul­ti­ples that are all time highs,” Nielsen said.

Da­ta from Sil­i­con Val­ley Bank (SVB) sug­gest strong per­for­mance of de­vice IPOs should spur con­tin­ued lat­er-stage ven­ture in­vest­ment. Mean­while, in­vest­ments in the first half of 2019 in dig­i­tal health have al­ready eclipsed full-year 2017 in­vest­ments and are on track to hit $10 bil­lion in 2019, the re­port said.

Deals for di­ag­nos­tics and med­ical tools are al­so ex­pect­ed to climb in the sec­ond half of 2019, and R&D tool in­vest­ment is set to surge fol­low­ing the suc­cess­ful IPOs of Adap­tive Biotech­nolo­gies and Per­son­alis, SVB an­a­lysts es­ti­mat­ed.

In the last year, the pub­lic mar­ket has been a suc­cess­ful way for Dx/Tools com­pa­nies to cap­ture val­ue. Ac­cord­ing­ly, we an­tic­i­pate more $B+ IPOs than pri­vate M&A for 2H 2019. We al­so be­lieve tech com­pa­nies will start to ac­quire Dx/Tools com­pa­nies in the AI/ML big da­ta space.

Com­pa­nies in the medtech sec­tor — akin to their coun­ter­parts in phar­ma — need to build out their pipelines. “Yet, there are very few… well cap­i­tal­ized, so­phis­ti­cat­ed medtech in­vestors that are avail­able to sup­port these com­pa­nies. And so we’re try­ing to kind of bridge that gap,” he added.

In the ex­it en­vi­ron­ment, there is a tremen­dous need for new tech­nolo­gies and start­up com­pa­nies. Whether that’s build­ing new prod­uct mar­kets in chron­ic dis­ease, or prod­ucts that are re­al­ly com­pli­men­ta­ry to block­buster fran­chis­es such as those in or­tho­pe­dics, re­con­struc­tive de­vices, or in­ter­ven­tion­al car­di­ol­o­gy.

“These (prod­ucts) can pro­vide val­ue growth dri­vers for some of the large ac­quir­ers in our space,” Klein said. “The ex­it mar­kets to­day have been great, but there’s a rel­a­tive dearth of com­pa­nies and in­no­v­a­tive prod­ucts that have made it to that phase.”

With the $225 mil­lion in their cof­fers, Ven­sana hopes to in­vest in a dozen com­pa­nies, in­ject­ing be­tween $10 to $30 mil­lion in each com­pa­ny, Klein not­ed.

Tesla and SpaceX founder Elon Musk gestures to the audience after being recognized by President Trump following the successful launch of a Falcon 9 rocket at the Kennedy Space Center. (via Getty Images)

Tes­la chief Elon Musk teams up with Covid-19 play­er Cure­Vac to build 'R­NA mi­cro­fac­to­ries'

Elon Musk has joined the global tech crusade now underway to revolutionize vaccine manufacturing — now aimed at delivering billions of doses of a new mRNA vaccine to fight Covid-19. And he’s cutting right to the front.

In a late-night tweet Wednesday, the Tesla chief announced:

Tesla, as a side project, is building RNA microfactories for CureVac & possibly others

That’s not a lot to go on. But the tweet comes a year after Tesla’s German division in Grohmann and CureVac filed a patent on a “bioreactor for RNA in vitro transcription, a method for RNA in vitro transcription, a module for transcribing DNA into RNA and an automated apparatus for RNA manufacturing.” CureVac, in the meantime, has discussed a variety of plans to build microfactories that can speed up the whole process for a global supply chain.

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George Yancopoulos (Regeneron)

Re­gen­eron co-founder George Yan­copou­los of­fers a com­bat­ive de­fense of the po­lice at a high school com­mence­ment. It didn’t go well

Typically, the commencement speech at Yorktown Central School District in Westchester — like most high schools — is an opportunity to encourage students to face the future with confidence and hope. Regeneron president and co-founder George Yancopoulos, though, went a different route.

In a fiery speech, the outspoken billionaire defended the police against the “prejudice and bias against law enforcement” that has erupted around the country in street protests from coast to coast. And for many who attended the commencement, Yancopoulos struck the wrong note at the wrong time, especially when he combatively challenged someone for interrupting his speech with a honk for “another act of cowardness.”

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Elias Zerhouni (Photo by Vincent Isore/IP3/Getty Images)

Elias Zer­houni dis­cuss­es ‘am­a­teur hour’ in DC, the de­struc­tion of in­fec­tious dis­ease R&D and how we need to prep for the next time

Elias Zerhouni favors blunt talk, and in a recent discussion with NPR, the ex-Sanofi R&D and ex-NIH chief had some tough points to make regarding the pandemic response.

Rather than interpret them, I thought it would be best to provide snippets straight from the interview.

On the Trump administration response:

It was basically amateur hour. There is no central concept of operations for preparedness, for pandemics, period. This administration doesn’t want to or has no concept of what it takes to protect the American people and the world because it is codependent. You can’t close your borders and say, “OK, we’re going to be safe.” You’re not going to be able to do that in this world. So it’s a lack of vision, basically just a lack of understanding, of what it takes to protect the American people.

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Pfiz­er shares surge on pos­i­tive im­pact of their mR­NA Covid-19 vac­cine — part­nered with BioN­Tech — in an ear­ly-stage study

Pfizer and their partners at the mRNA specialist BioNTech have published the first glimpse of biomarker data from an early-stage study spotlighting the “robust immunogenicity” triggered by their Covid-19 vaccine, which is one of the leaders in the race to vanquish the global pandemic.

Researchers selected 45 healthy volunteers 18-55 years of age for the study. They were randomized to receive 2 doses, separated by 21 days, of 10 µg, 30 µg, or 100 µg of BNT162b1, “a lipid nanoparticle-formulated, nucleoside-modified, mRNA vaccine that encodes trimerized SARS-CoV-2 spike glycoprotein RBD.” Their responses were compared against the effect of a natural, presumably protective defense offered by a regular infection.

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Randy Schatzman, Bolt CEO (Bolt Biotherapeutics)

Bolt Bio­ther­a­peu­tics nabs $93.5M to push Provenge in­ven­tor's new idea deep­er in the clin­ic

A cancer-fighting concept from the inventor of the first cancer vaccine is nearing prime time, and its biotech developer has received a significant new infusion of cash to get it there.

Bolt Biotherapeutics announced a $93.5 million Series C round led by Sofinnova Investments and joined by more than 9 others, including Pfizer Ventures and RA Capital Management. That money will go toward pushing the San Francisco biotech’s platform of innate immune-boosting warheads through its first trial on metastatic solid tumors and into several more.

Josh Cohen, Justin Klee

Armed with pos­i­tive ALS da­ta, Amy­lyx scores $30M in fresh fund­ing to com­plete Alzheimer's PhII

Four years after announcing themselves to the biotech world with a new idea for drugging neurodegeneration, backing by the late Henri Termeer and $5 million from Morningside Venture, the young entrepreneurs at Amylyx are back for round 2.

Morningside continued to lead the $30 million Series B, with participation from Termeer’s widow, Belinda, and other unnamed investors. Having celebrated a topline Phase II win for its lead program in amyotrophic lateral sclerosis, Amylyx expects the cash to fund talks with regulators as well as a separate trial for the same drug in Alzheimer’s — for which they had just finished enrolling.

Sec­ond death trig­gers hold on Astel­las' $3B gene ther­a­py biotech's lead pro­gram, rais­ing fresh con­cerns about AAV

Seven months after Astellas shelled out $3 billion to acquire the gene therapy player Audentes, the biotech company’s lead program has been put on hold following the death of 2 patients taking a high dose of their treatment. And there was another serious adverse event recorded in the study as well, with a total of 3 “older” patients in the study affected.

The incidents are derailing plans to file for a near-term approval, which had been expected right about now.

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An ex­pe­ri­enced biotech is stitched to­geth­er from transpa­cif­ic parts, with 265 staffers and a fo­cus on ‘new bi­ol­o­gy’

Over the past few years, different teams at a pair of US-based biotechs and in labs in Japan have labored to piece together a group of cancer drug programs, sharing a single corporate umbrella with research colleagues in Japan. But now their far-flung operations have been knit together into a single unit, creating a pipeline with 10 cancer drug development programs — going from early-stage right into Phase III — and a host of discovery projects managed by a collective staff of some 265 people.

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New stan­dard of care? FDA hands Pfiz­er, Mer­ck KGaA an OK for Baven­cio in blad­der can­cer

The breakthrough therapy designation Pfizer and Merck KGaA notched for Bavencio in bladder cancer has quickly paved way for a full approval.

The PD-L1 drug is now sanctioned as a first-line maintenance treatment for patients with locally advanced or metastatic urothelial carcinoma, applicable in cases where cancer hasn’t progressed after platinum-containing chemotherapy.

Petros Grivas, the principal investigator of the supporting Phase III JAVELIN Bladder 100, called the approval “one of the most significant advances in the treatment paradigm in this setting in 30 years.”