An increased incidence of counterfeit drugs around the world has people worried about the health problems they can cause, among other issues.
That’s sparked a wave of interest in companies that are creating technologies to potentially sniff out counterfeit drugs. Now, a Massachusetts business that tracks and documents the authenticity of pharmaceutical drugs globally has raised $51.5 million in a Series C round of funding, which was led by GS Growth, an investment arm of Goldman Sachs focused on growth-stage, investment-driven businesses.
TraceLink, based in North Reading, MA, plans to build out its sales and marketing teams in Europe with the new money, partly in preparation for a 2019 deadline for most members of the European Union to establish a process of authenticating drugs. The company also wants to expand its research and development projects to potentially create new products, according to a spokeswoman.
TraceLink uses cloud-based software that allows companies in the pharmaceutical industry, from manufacturers to distributors, to perform various tasks around authenticating and tracking the drugs they work with. That includes meeting regulatory compliance standards, storing what can be a massive amount of data created by tracking individual packages of drugs, and interacting with other companies that use TraceLink (such as manufacturers coordinating with distributors).
Founded in 2009, TraceLink now has more than 450 life science companies on its platform (which is hosted by Amazon Web Services), according to a press release. That’s up from about 100 in February 2015, when CEO Shabbir Dahod spoke with Xconomy about the company raising a $20.2 million Series B round.
Counterfeit drugs—ranging from fake lifestyle drugs to treatments for diabetes and cancer that may have a fake active ingredient or lack one entirely—kill millions of people every year, which is part of the driving factor behind TraceLink, Dahod said last year. The fake drugs may have none or too much of the highly regulated active ingredient that treats a condition, or even the wrong active ingredient, according to the FDA. That can lead to unintended side effects, allergic reactions, or other more hazardous results, the agency says.
Other companies, such as New York-based PharmaSecure, have developed similar tools for tracking and verifying prescriptions, offering systems of printing unique bar codes on pill packages that can be verified via text message. TraceLink believes its cloud-based infrastructure elevates its offering, which aims to not only let customers track large amounts of data, but also is meant to let them exchange data on the platform, almost like a social network, Dahod said in 2015.
“One of my key thought patterns was to really apply to manufacturing what I was seeing in the social networking area back in 2008 and 2009,” he said.
TraceLink’s previous investors also participated in the new funding, including FirstMark Capital, Volition Capital, and F-Prime Capital. The company has received $9.6 million in other equity and debt funding since 2012, according to regulatory filings. TraceLink invested more than $2 million in a new facility in North Reading, moving from nearby Wakefield, MA, north of Boston.