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Five Biotech Startups to Watch in 2015

Tue, 01/13/2015 - 5:02pm
Ryan Bushey, Associate Editor

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More money is being funneled into science based startups, especially fledgling companies in the biotech sector.

A report in The New York Times by Hiroko Tabuchi explained that “investments in biotechnology start-ups rose 26 percent in the first half of 2014, to $2.93 billion, from the period a year earlier and is on track to exceed the 2008 peak of $5.14 billion.”

Tabuchi writes that a possible explanation for this uptick in funding for science startups is a “growing feeling” among investors that Silicon Valley’s best and brightest are steering clear of the world’s biggest problems.

Founders Fund, the venture capital firm started by legendary investor Peter Thiel, echoes this sentiment with this company motto: “We wanted flying cars, instead we got 140 characters.”

“We’ve had enormous progress in the world of bits, but not as much in the world of atoms,” Thiel told Fortune Magazine in an interview.

Now, this deluge of capital brought attention to numerous innovative companies last year.

Here are five biotech startups to watch in 2015.

Recursion Pharmaceuticals

A group of scientists and engineers at the University of Utah launched this startup with a lofty goal: “develop 100 drugs in 10 years.”

Dean Li, founder of Recursion Pharmaceuticals, explained in an interview that he was frustrated with the pace of the traditional drug development process. Recursion’s plan is to utilize a customized software program that can efficiently and affordably figure out how a drug can react to a diseased cell.

The idea is that this could cut down on the time it takes to manufacture therapies for different diseases. It can take years to discover the source of disease and go through multiple test phases before a drug finally reaches the market.

Drug development for orphan diseases are the startup’s primary target.

Vestaron

Vestaron is a Michigan-based manufacturer working on a series of eco-friendly products for the agriculture industry. The first creation in the company’s pipeline is a pesticide derived from the peptides found in spider venom.

Dr. John Sorenson, Vestatron’s CEO, told Southwest Michigan’s Second Wave that “insecticides have historically been bad actors: highly toxic to humans, highly toxic to environment.”

Vestaron’s chemical “reduces agriculture’s environmental footprint, makes work safer for agricultural laborers and overcomes the resistance pests have built up to other pesticides over the years,” according to The New York Times.

In February 2014, the EPA approved Vestaron’s insecticide. The company released a statement that said the agency found the chemical was non-toxic and could be used on a number of crops. This approval helped the company land an additional $10 million investment in September 2014 which was led by Cultivian Sandbox Ventures, a firm that specializes in food and agriculture companies.

Owlstone

Owlstone is harnessing nanotechnology that is capable of quickly identifying the properties of a given object.

One item in particular is getting some attention: a microchip that can detect and analyze a vast array of chemicals in the surrounding environment.

CNN reported that the chip was initially made for defensive purposes. Dr. Andrew Koehl, the inventor of this technology, told CNN that the chip was conceived as a sensor for dangers on the battlefield like toxins or explosive chemicals.

However, Dr. Koehl is working with Owlstone to bring this technology into the healthcare market since he feels it has potential to be a diagnostic tool.

"What's amazing is that there really are compounds on your breath that indicate illness, that's been shown through a number of studies and we can detect those," he explained to CNN.

Foundation Medicine

Foundation Medicine focuses on the analysis of molecular shifts that can induce disease in order to improve cancer diagnostics. According to the company’s website, the data that the team harvests can be used to track how cancer develops and pinpoint the best drug for treatment.

Re/code’s James Temple wrote that Foundation’s CEO Michael Pellini believes this is what cancer treatments could eventually become: “A chronic disease where oncologists and patients stay one step ahead by continually monitoring conditions and shifting treatments.”

Foundation’s 2015 plans include a new research partnership with Roche that will aid in the discovery and development of cancer treatments.

Soylent

Soylent, not to be confused with the famous film, is engineering a brand new source of food. Creator Rob Rhinehart hopes that this concoction can ultimately replace an entire meal.

The FDA awarded a nutrition label to Soylent in January 2014. It contained high traces of potassium, vitamin A, vitamin B, and other ingredients. Fat, cholesterol and sodium counts didn’t match up as closely, according to Vice.

Reviews of samples were mixed, but investors saw promise. Re/code revealed last week that the startup gained a new infusion of capital valuing Soylent at $100 million.

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