Author: Ryan McBride

Arch, Polaris Spring deCode from Chap. 11

DNA, deals, Life Sciences

Ryan McBride wrote:

Venture Wire reports today that a Delaware bankruptcy court has approved the sale of Iceland-based genomics firm deCode Genetics to Arch Venture Partners and Polaris Venture Partners, both of which are previous investors in the company. Waltham, MA-based Polaris and ARCH, which has operations in Boston and Seattle, are paying $14 million for the deCode assets, the report says. DeCode (NASDAQ:DCGN) filed for Chapter 11 bankruptcy protection in November. Bob Nelsen, a managing director at Arch, wrote in an e-mail that he would talk about the deal next week, when the deal is expected to be formally announced.

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January 15, 2010
Bonding with BIND Biosciences’s New CEO Scott Minick

Life Sciences, ceos, people

Ryan McBride wrote:

[Clarified and Corrected—7:30 AM, 01/15/10] Scott Minick made his official debut as CEO of BIND Biosciences Monday at the JP Morgan Healthcare Conference in San Francisco, which makes for one of the most frenetic weeks of the year for biotech chiefs. The Cambridge, MA-based startup also made some news this week with the announcement of an $11 million Series C round of venture capital led by wealthy businessman and philanthropist David Koch.

Despite the crazy schedule at JP Morgan, Minick was pleased with the progress his Cambridge, MA-based startup was making in talks with pharmaceutical companies at the major biotech meeting. The firm has an attractive offering for large drug companies: nanoparticles that have the potential to deliver drugs to specific tissues in the body while significantly reducing the side effects of the compounds they carry. The value of the firm’s sciences was plenty to convince Minick to invest in the startup in 2007 as a managing partner at ARCH Venture Partners, he said, and it also influenced his recent decision to end his 11-year tenure at the venture firm to become BIND’s full-time CEO.

Minick’s road to the CEO post at the startup dates back to before he became a venture capitalist. He was president and chief operating officer of the California biotech Sequus Pharmaceuticals (Liposome Technology), which developed and in 1995 won FDA approval of a cancer drug called liposomal doxorubicin (Doxil). The treatment encases cancer drugs in molecules known as liposomes, which are used to home in on tumor cells and deliver the drugs before they are filtered through a patient’s kidneys. And the drug’s use of liposomes was an early-stage version of part of BIND’s science, which involves the use of liposomes on the outside of drug particles to help them attach to specific cell types.

“I had a lot of experience in doing precisely what BIND is looking to do, but with an entirely different and much more powerful technology [than Sequus’s],” Minick said. “This space has always been one that I’ve been interested in and followed closely. And I had looked for an investment to make [in this field] but just could not find the right technology platforms until a couple of years ago, when I met the Bind team.”

Scott Minick, CEO of BIND Biosciences

Minick became an unofficial interim CEO at BIND about four months ago, when previous chief executive Glenn Batchelder’s tenure as chief executive ended. (He declined to comment on the circumstances around Batchelder’s departure from the company.) The board of directors identified some great candidates when it searched for a permanent chief executive, he said, but they decided that they liked the direction that Minick was leading the firm. That course is aimed at the firm’s first human clinical trial.

In the second half of 2010, the startup plans to begin a Phase I clinical trial of its lead nanoparticle drug, dubbed BIND-014, for treating solid tumors. The treatment is a polymer nanoparticle loaded with a well-known chemotherapy drug called docetaxel, which registered 2008 revenue of …Next Page »

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January 15, 2010
Segway Business Shifting Gears with Ownership and Management Changes

deals, energy, startups

Ryan McBride wrote:

Segway, the maker of two-wheeled transporters of the same name, has been sold through a merger with a UK holding company for an undisclosed sum, and the firm’s CEO, Jim Norrod, has stepped down from his post after nearly five years in that role, a company spokesman confirmed today. Reports about the action at Segway have been swirling since yesterday, after chatter about the merger and management reshuffle surfaced on online forums earlier this week.

The Bedford, NH-based firm also confirmed the reports about the merger today on its blog, saying that the deal was completed on December 24. The acquiring company is backed by British businessman Jimi Heseldon, the chairman of Leeds, UK-based military container maker Hesco Bastion.

Norrod left the chief executive position at Segway last week, and the firm’s financial chief, Brian Cohen, has taken over Norrod’s responsibilities on an interim basis, said company spokesman Eric Fleming today. He said that the company will remain headquartered in New Hampshire, where most of its 85 employees are based. The new owner is also expected to provide an undisclosed amount of fresh capital for the operation.

Fleming declined to provide more details about information from a recent letter to shareholders that has appeared in online Segway forums this week. One of the shareholders who received the letter wrote that Tricia Laidler has been named CEO of the company and Wayne Mitchell of a UK Segway dealership has been appointed chief operating officer. Fleming would not confirm these details, however.

This does not appear to have been a profitable transaction for some of Segway’s investors, given that at least one shareholder commented on a Segway forum that his recently received shareholder letter says that all common stock in the privately held company has no exchange value in the merger transaction. Fleming wouldn’t comment on how investors made out in the merger. The company has reportedly raised some $176 million from high-profile investors such as Kleiner Perkins Caufield & Byers, Amazon founder Jeff Bezos, and Credit Suisse First Boston Private Equity, to name a few, according to reports in Mass High Tech and other publications.

The company’s sale is the latest episode in the story of a much-hyped technology that has fallen woefully short of expectations and lofty predictions about its impact on society. According to a retrospective piece on Segway last month in Wired, Apple founder Steve Jobs forecasted early in the last decade that the Segway would outstrip the personal computer in significance.

Dean Kamen, the famous inventor behind the Segway and other innovations, unveiled the transporter in 2001 with much fanfare, including this lofty feature in Time, headlined “Reinventing the Wheel.” Indeed, the Segway’s key innovations, such as its dynamic stabilization technology, are major feats of engineering. But the vehicles have never gained mainstream adoption. (They have, however, found a niche in the security and public safety markets—Fleming said that Segways are in use at more than 1,200 police installations and 525 tourist operations around the world.) Some have said the cost of the vehicle, which is in the $5,500 range, is too high for most people.

Still, Segways still have a shot at popularity as interest rises in modes of transportation that are friendly to Mother Nature. In April, Segway and General Motors announced a collaboration to develop a larger version of the two-wheeled transporter that has seating. The companies called the effort Project P.U.M.A (for personal urban mobility and accessibility) and said that the prototypes run on lithium-ion batteries and can be driven 35 miles between charges.

Kamen, the head of R&D firm DEKA Research in Manchester, NH, was not available at his office today. We’ll update our readers on any changes in the Segway story as we learn of them.

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January 14, 2010
Fina Technologies Aiming to Build Smarter Computer Models for Wall Street

wall street, Computer Modeling, startups

Ryan McBride wrote:

Wall Street is no stranger to computer models, which have been used for more than a decade by fund managers and traders to beat the market. But many of the models developed by the so-called “quants” have proved insufficiently prescient—they didn’t do a very good job, for example, of predicting the subprime mortgage crisis. Using computer modeling software initially developed to help pharmaceutical firms find biological targets for new drugs, Cambridge, MA-based Fina Technologies is hoping to recharge the troubled financial sector.

Fina has licensed its so-called “reverse engineering/forward simulation” (REFS) technology from Cambridge’s Gene Network Sciences, which has been developing and applying REFS for drug companies for several years. Under the REFS approach, software analyzes massive amounts of historical data to divine causal links, then makes forward projections based on the connections it’s discovered.

Fina boosted its prospects last month by closing a $4.5 million first-round financing from a pool of investors led by Reed Elsevier Ventures, the venture arm of the media and publishing conglomerate Reed Elsevier. Josh Holden, the CEO of Fina (and an early angel investor in Gene Network Sciences), talked to me recently about how the startup plans to use the cash to fund efforts to promote the REFS technology in the financial world.

Investment computer models—which are basically algorithms based on investment hypotheses—have had varied success. Holden, an MIT-trained engineer with more than a decade of experience in the investment world at Deutsche Bank and other financial institutions, says that a chronic problem is trying to jam too many variables or parameters into these algorithms. Fina aims to overcome this over-modeling problem with the REFS platform, which has shown that it can handle the massive amounts of data about biochemical signaling pathways in the human body needed to make predictions about how various drug candidates will affect the system.

“What we’re trying to do, at the most fundamental [level], is to automate the scientific method,” Holden says, “which is basically to propose a hypothesis, test whether that hypothesis is true in the presence of experimental data, [and] compare it to other hypotheses out there all with an eye toward controlling for over-fitting and complexity.”

The firm’s technology integrates input from multiple models before making predictions about the market, Holden explains, rather than using one algorithm overloaded with parameters. The upshot is that traders at hedge funds could predict changes in the market 5 minutes to 30 minutes before they happen, then buy or sell ahead of time to capitalize on the upward or downward shift in price, he says.

The startup has built sample models with the platform that make Holden confident that the technology makes the correct predictions about 55 to …Next Page »

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January 14, 2010
Qteros Switches CEOs to Accelerate Progress, New Chief Says

energy, ceos, Partnerships

Ryan McBride wrote:

Qteros, the Marlborough, MA-based developer of cellulosic ethanol technology, has brought on industry veteran John McCarthy as CEO and bid adieu to former chief executive Bill Frey. The company announced McCarthy’s appointment this morning.

McCarthy, who joined the startup last week, was the executive vice president at Cambridge, MA-based cellulosic ethanol developer Verenium (NASDAQ:VRNM). He said he led Verenium’s landmark 2008 deal (worth $90 million) with energy giant BP to collaborate on the development of ethanol made from non-food sources, or cellulosic ethanol. This is the type of deal McCarthy is now working on bringing to Qteros, he said.

Qteros—which is developing microbes to reduce the normally multi-phased process of producing ethanol into a single step—has raised around $30 million in venture capital from deep-pocketed investors such as Battery Ventures, BP Ventures, Valero Energy, and Venrock Associates, to name several. Yet under the leadership of former CEO Frey, who joined Qteros in mid-2008 after serving as an executive for chemical industry juggernaut DuPont (NYSE:DD), a major corporate partnership on par with the Verenium-BP deal has eluded the startup.

“The company is at a stage of development where the board and the investors felt that we really needed to accelerate to the next level of development and felt that I was the right person for the job,” said McCarthy, who was previously the chief business officer at Lexington, MA-based biotech chemical firm Microbia.

Qteros (formerly SunEthanol) is among a number of startups such as Lebanon, NH-based Mascoma that are developing microorganisms that can help turn feedstocks such as corn stalks, switch grass, woodchips, and other cellulose-based materials into ethanol. McCarthy said that the Qteros technology is capable of producing ethanol at a price similar to traditional corn-derived ethanol. And as the price of gasoline rises, he said, the firm’s process could eventually yield ethanol that is priced competitively with petroleum-based fuels.

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January 13, 2010
Joule Selects Texas for Ethanol Facility

energy, ethanol, Photosynthesis

Ryan McBride wrote:

Joule Biotechnologies, a Cambridge, MA-based developer of fuels and chemicals in a process that mimics photosynthesis, today confirmed a newspaper report in the Leander Ledger from last month that it is leasing property in Leander, TX, for its pilot ethanol plant. A company spokeswoman said that the lease on the property near Austin became official this week. Xconomy reported last month that Joule had selected a site for the pilot plant, but the firm had declined to reveal the exact location before the lease was finalized.

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January 12, 2010