Clinical Genomics, a biotechnology company working across the United States and Australia, has closed a US$15 million ($19.7 million) round led by Sydney-based VC firm OneVentures. Dr Paul Kelly, partner at and managing director of OneVentures and former CEO of biotech company Gemini Genomics, will join the company’s board of directors.
With Clinical Genomics specialising in products assisting with the screening and diagnosis of colorectal cancer (CRC), the funding will go towards the commercialisation of the company’s two-gene blood test, which it describes as a ‘liquid biopsy’ for post-surgical monitoring of CRC recurrence, which has been developed with the assistance of the CSIRO.
“The company has a record of bringing novel clinical diagnostics to domestic and international markets and growing market share. While addressing a significant immediate opportunity in CRC monitoring with its highly sensitive and specific blood based two-gene test, Clinical Genomics is also uniquely positioned to transform colorectal cancer screening in the general population,” Kelly said.
Clinical Genomics is a leader in the CRC screening market, having sold over three million tests in 2015. It has also recently gained regulatory approval from the Chinese food and drug administration.
Dr Lawrence LaPointer, president and CEO of Clinical Genomics, said that the fresh funding, the company’s first institutional capital raise, will provide critical resources to support the commercialisation of new products.
“Clinical data show that our test is approximately 2.5 times more sensitive than the current guidelines-recommended standard periodic blood test, and we are optimistic that our liquid biopsy technology has the potential to address an unmet need in colorectal cancer recurrence monitoring,” he said.
Clinical Genomics joins a number of medical companies in the OneVentures portfolio, with the firm looking directly to the biotechnology and life sciences markets for its Innovation Fund II. Companies in its portfolio include Vaxxas, which has created a system that administers vaccines through nanopatches.
Another, Hatchtech, developers of a next generation head lice treatment, had a successful exit last September, signing a commercialisation agreement with pharmaceutical company Dr Reddy’s Laboratories.
Kelly said that the investment into Clinical Genomics fits well within the VC firm’s mandate of financing later stage companies which require between $5 to $15 million to launch new products and fuel growth in international markets through its $100 million Innovation and Growth Fund II.
“This focus addresses the second “valley of death”, a term used to describe the lack of later stage venture or other funding available in Australia,” he said.
OneVentures CEO and managing director Dr Michelle Deaker recently called on VCs to provide capital and expertise to Australian companies that are looking to make sustainable contributions to the economy.
“A lot of investment is funnelled towards trying to find the next “unicorn”. Success stories such as Uber and Facebook are exceptions that prove the rule. Venture capital investment should not be about the next billion dollar unicorn but instead focus instead on backing companies with both capital and expertise to build highly successful, sustainable businesses,” she said.
“Rather than trying to find a unicorn, we focus on hunting ‘dragons’, companies that ideally return the whole of a Fund to investors.”
Image: the OneVentures team.