Seven Years Into Personalized Medicine Foray, Mohr Davidow Stays Patient, Keeps Betting on Big Idea

Xconomy San Francisco — 

Personalized medicine is one of those big ideas people have been talking about for a decade, and it still hasn’t made much of an appearance in the doctor’s office. But to Menlo Park, CA-based Mohr Davidow Ventures, after seven years of bets on this big idea, it still has all the promise of a field in its early days.

“Personalized medicine is happening,” says Bill Ericson, the managing partner at Mohr Davidow. “The thesis is sound. It takes years to develop these products, it doesn’t happen overnight.”

It was worth a broader conversation with Ericson, given that we’ve reported on a flurry of deals in personalized medicine this month. Menlo Park-based Pacific Biosciences raised a whopping $109 million for faster, cheaper gene sequencing machines intended to enable more precise diagnostics. Emeryville, CA-based Tethys Bioscience secured $33 million in equity and debt for the commercial rollout of a test that predicts a patient’s risk of developing diabetes. And we profiled Waltham, MA-based On-Q-ity and its effort to develop a test to predict which types of breast cancer are likely to relapse.

Much has been written ever since the heady days of the Human Genome Project at the turn of the last decade about how a deepening understanding of genetics will put an end to reactive, one-size-fits-all medical treatments. It was supposed to bring about a more nuanced view of an individual’s state of disease and wellness, offering powerful new information that physicians can use to predict problems before they become full-blown symptoms, and possibly prevent them.

Ericson was inspired to follow this path back when he was part of the founding team at Kirkland, WA-based Rosetta Inpharmatics. That company did pioneering work on cancer genetics and was ultimately sold for more than $600 million to Merck in 2001. It was the early days of personalized medicine, as the BRCA1 and 2 genes had been identified for their link to higher rates of breast cancer in women, and Genentech had won FDA approval for a breast cancer drug, trastuzumab (Herceptin), that was approved specifically for a certain subpopulation of patients with another genetic mutation.

Bill Ericson

Bill Ericson

Ericson joined Mohr Davidow in 2000, and soon went to work on forming a thesis on how to invest in personalized medicine. He spent 2-3 years working out the idea, figuring out what parts of the technology were mature, and which parts weren’t. He focused on improvements in measurements from samples, essentially getting a lot more information than ever before out of a drop of blood or a tissue biopsy. But equally important was what that information could enable a physician to do that he or she couldn’t before. “It was about ‘How do you measure and enable? How do you apply the measurement to disease states?'” Ericson says.

Seven years into this strategy, Mohr Davidow counts one clear success story—ParAllele Biosciences’ 2005 sale to Santa Clara, CA-based Affymetrix for more than $130 million. Some of its more recent companies, like PacBio, Tethys, On-Q-ity, Raindance Technologies, and Artemis Health, haven’t yet had their big payday. Ericson wasn’t about to go on the record … Next Page »

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