Early Biotech Startups Take Stage at Carlsbad Bio Incubator

Xconomy San Diego — 

When Bio, Tech, & Beyond held its first open house a little over two years ago, co-founders Joseph Jackson and Kevin Lustig described it as an experiment in do-it-yourself biology. “We represent an opportunity where [scientists] can come in with their idea, and very inexpensively come up with results,” Lustig said at the time.

With generous lease terms from the city of Carlsbad, CA, Jackson and Lustig established one of the first “biotech garage” labs for entrepreneurs, and others who believe that life sciences innovation should be accessible, affordable, and open to everyone. According to Jackson, 100 startup teams sought space at their lab, 24 moved in, and seven have moved on.

Of the 19 startup teams currently incubating, nine delivered short presentations at a recent “startup showcase” at the Thermo Fisher Scientific facility in Carlsbad , which provided a glimpse at the kind of innovations that Bio, Tech, & Beyond has been incubating. For example, Exeligen Scientific is advancing new techniques in genome editing, GPB Scientific is using micron-scale cell sorting technology in so-called liquid biopsies, and at least two others are advancing PCR-related techniques for detecting and analyzing DNA.

“We’ve worked with companies on a case-by-case basis, helping with business development, but the incubator is still ‘no strings attached,’” Jackson tells me. “[The] next goal is to create a seed fund to go along with the lab and offer a package of cash plus services/benefits for some equity/options.”

Combining the biotech incubator with a seed fund has always been part of their plans, Jackson says.

In an e-mail, he writes, “I always emphasize that BTnB [Bio, Tech, & Beyond] can only address one particular piece of the rather severe problems holding back the biotech industry. We can help more entrepreneurs iterate faster on their ideas, but systemically, the life sciences industry must continue to evolve to embrace many of the best practices that emerged in the IT sector from the 1980s-2000s. This doesn’t happen overnight, but the trends are converging (automation, outsourcing to CROs and web-enabled “science as a service” options).”

Joseph Jackson

Joseph Jackson

Similar efforts abound: In the Boston area (as Xconomy recently reported), LabCentral and Cambridge BioLabs are forming Bioinnovation Capital, a $150 million fund to make seed and early stage biotech investments. In the Bay Area, QB3 operates several biotech incubators (and is partnered with Boston’s LabCentral), the accelerator IndieBio provides $250,000 per company for an 8 percent ownership stake, and the high-profile tech incubator Y Combinator has been admitting and funding biotechs. Meanwhile Johnson & Johnson now operates JLabs Innovation Centers in San Diego, the Bay Area, Boston, and Houston.

Jackson says the proliferation of biotech incubators represents a sea change from 2009, when he was trying to raise funding in Silicon Valley for a bio-incubator. “Everything is progressing along the trajectory we envisioned,” Jackson writes. “It is just taking a bit longer and it is always impossible to pick particular winners.

“My intent all along has been to lower the bar and enable more ‘shots on goal’ for the most difficult problems. So far I think we’re doing that well in the aggregate.  In the next 10 to 15 years it will be increasingly possible to start, scale up, and exit a biotech company without the involvement of typical VC or institutional funding.  I do think there is huge need for other sources of innovative capital and financing, whether it is sophisticated patient groups conducting their own ‘venture philanthropy,’ or bond mechanisms for R&D such as what has been proposed by Andy Lo at MIT,” Jackson adds.

At Bio, Tech, and Beyond, Jackson says they get six or seven inquiries a month from biotech entrepreneurs who are interested in using the lab to launch their business.

While the startup teams vary widely in age and experience, Jackson says they are all trying to advance their ideas—and build value—in the most capital-efficient manner possible. The companies are typically in early proof-of-concept stage, a period that might range from three to 12 months as they seek to validate key technologies.

Companies using the Carlsbad lab are developing products in sectors that include agriculture, infectious disease diagnostics, cancer therapeutics, medical devices, biomarkers, industrial biotechnology, and environmental waste remediation.

Here’s a rundown of the presentations that nine companies gave Friday gave at the Bio, Tech, & Beyond startup showcase. (The showcase was co-sponsored by Thermo Fisher Scientific and the City of Carlsbad, which has stepped up efforts to promote the surrounding area in northern San Diego County as an innovation hub in its own right.)

Tinoro. Led by Harel Hakakha, a former senior engineering manager at Carlsbad, CA-based Life Technologies (now Thermo Fisher Scientific), Tinoro has licensed non-thermal (pH-based) PCR technology from UC San Diego for a handheld, low-cost device intended to significantly reduce the time required for DNA amplification.

EcoFeedstock. CEO Ryan Silver is overseeing development of technology that uses organic industrial waste to develop sustainable biofuels and other products, such as oil that prevents concrete from sticking to metal or wooden forms used by the construction industry.

Ryan Silver of Eco Feedstock

Ryan Silver of Eco Feedstock

GPB Scientific. Richmond, VA-based GPB Scientific uses micro-fluidic technology to create nano-filters used in cell separation by life sciences companies and research institutions. According to a regulatory filing, GPB Scientific recently raised $2 million. GPB president Tony Ward, a former senior VP at eBioscience and Affymetrix, said the funding is being used to advance technology that can separate circulating tumor cells in a blood sample, enabling scientists to sequence the tumor and provide more personalized therapeutic options.

Biomarker Profiles. Founder Leticia Cano, an expert in mass spectrometry analysis, has developed technology for discovering biomarkers that can be used to diagnose disease. After securing a Small Business Innovation Research grant, the company is advancing an assay to identify and quantify pain biomarkers.

Aomics. Founder Shaochun Song is developing an improved version of the anti-cancer drug paclitaxel (Taxol) for targeted delivery, by fusing an antibody to the paclitaxel molecule.

Vanadis Laboratories. Co-founder Andrew Tedsherani said Vanadis Labs specializes in protein chemistry and immunology, and has developed a test to analyze cosmetic products for antigens from natural rubber latex. Such testing enables a cosmetics manufacturer to validate their ingredients are not harmful to latex-allergic customers.

Cascade Biosystems. Principal scientist Metin Bilgin has developed diagnostics technology that uses a technique called Restriction Cascade Exponential Amplification to detect specific types of DNA.

Koliber Biosciences. Founder Ewa Lis specializes in genetically engineering the metabolism of microorganisms to produce commercially useful biochemicals and biofuels. Koliber is seeking partners in analytical chemistry to develop molecules.

Exeligen Scientific. Exeligen is working to improve on recent advances in genome editing technology known as clustered regularly interspaced short palindromic repeats (CRISPR/Cas systems) and CRISPR/Cas-related systems.