Seattle’s Accelerator Corp. made its long-awaited splash in New York last week with its first Manhattan biotech startup, Petra Pharma. Now here comes Lodo Therapeutics, Accelerator’s second startup, right in Petra’s wake.
Lodo didn’t get the big $48 million round that Petra did last week. But the startup, built around the work of Rockefeller University researcher Sean Brady, got a respectable $17 million Series A round and, what’s more, some of that money comes from The Bill & Melinda Gates Foundation—which has over the past few years increasingly sought to back biotech startups that align with its mission of improving global health. (The rest of Lodo’s round comes from Accelerator and the investors in its latest fund, which include a number of VC firms and pharmaceutical companies.)
Accelerator CEO Thong Le says this is the first time his firm and the nearby Gates Foundation have worked together on a company. The deal came together partly because the Gates Foundation was already on the scene, supporting Brady’s work at Rockefeller via a grant for at least a year. Program investment officer Charlotte Hubbert says that the foundation was very interested in “scaling and expanding” Brady’s work—a large effort to effectively sequence and understand the genetic information of microbes in dirt samples, hopefully to unearth new drugs.
“He’s a tremendous scientific talent,” Hubbert says of Brady.
This concept isn’t new, of course. The pharmaceutical industry had its roots in so-called natural products, or drugs culled living organisms before chemistry-based approaches took hold. And many important drugs of the modern era, from antibiotics to immunosuppressants to anticancer drugs, are derived from living organisms, including soil microbes. But, Brady (pictured) says, “it turns out that the soil has many many more of those bugs, and [with] many of the bugs that we’d thought we’d looked at in great detail we’d really missed a lot of what they can do.
With the help of sequencing tools, Brady’s been trying to fill in those knowledge gaps. Over the past decade, his lab has been collecting soil samples from all over the U.S. and around the world and sequencing the microbes in them (the name “Lodo,” Spanish for mud, is a hat tip to that project). The aim, he says, is “to generate a map of where genes that encode molecules of interest might be,” and to use the map to find new therapies–say, for instance, a new derivative of the antibiotic vancomcyin that can destroy drug-resistant bugs.
“If we can intelligently go out and find those, we have a much more efficient way [of discovering new drugs] than just random searching for molecules,” he says.
For the Gates Foundation, Brady’s work is a way of potentially uncovering new treatments for infectious diseases. In the announcement this morning, the foundation specifically mentions the potential, through Lodo, of finding new and better treatments for tuberculosis—a leading cause of death in poor countries around the world—and dealing with drug-resistant bugs. Hubbert also says that Brady can get from initial discovery to a drug ready for human testing “quickly,” though she wouldn’t be more specific in terms of how this compares to other methods.
Accelerator also isn’t being very specific as to its plans for Lodo, what the company actually has at this point, or how far away it is from clinical testing. The company is looking into a range of diseases—from cancer to metabolic and rare diseases—and has hired an industry veteran, David Pompliano, as its interim chief scientific officer. (Pompliano had stints as an executive at Merck and GlaxoSmithKline and as an entrepreneur-in-residence at Boston’s Third Rock Ventures recently helped form another drug discovery startup, Revolution Medicines.)
Lodo is now the third high profile startup to close a Series A round in New York in the past month, joining Petra and Kallyope—all three of which are located at the Alexandria Center for Life Science on Manhattan’s East Side. Each of these three companies spun out from different research institutions in Manhattan—Weill Cornell Medical College (Petra), Columbia University (Kallyope), and Rockefeller (Lodo). While this is commonplace in the established biotech hubs of Boston and San Francisco, this is the type of thing that hasn’t happened in New York before for a number of reasons. The influx of early stage venture investors such as Accelerator has helped. Brady is hoping this is just the start.
“It means that people can imagine staying in New York after they get out of their academic career training as postdocs and grad students, that they can continue to do science as opposed to have to transition to the financial world,” Brady says. “It’s an exciting time.”
Accelerator’s co-investors in Lodo include AbbVie, Alexandria Venture Investments, Arch Venture Partners, Eli Lilly, Harris & Harris Group, Innovate NY Fund, Johnson & Johnson Innovation, The Partnership Fund for New York City, Pfizer Venture Investments, Watson Fund, and WuXi PharmaTech. I’ve written before about Accelerator and its ambitions in New York.