TEDCO’s Maryland Innovation Initiative Fund Continues to Deliver Substantial Impact for Maryland Biohealth Companies

August 20, 2019

The Maryland Technology Development
Corporation’s (TEDCO) Maryland Innovation Initiative (MII), a
program designed to propel research from partner universities towards
commercialization, has had a strong, demonstrable impact on many important life
science portfolio companies in the BioHealth Capital Region (BHCR).

AsclepiX
Therapeutics, Inc., Neuraly/Theraly, NextStep Robotics,
Sonavex
and Coaptechare just a handful of the latest MII
program success stories having achieved important tech transfer and
commercialization milestones for their respective technologies with a jumpstart
in funding and support from the MII program.

The MII program’s mission is to accelerate and
augment the commercialization of promising technologies from “Bench to Market”
through start-up creation. The program offers grants to de-risk technologies in
the university and investments to the spinouts to jump start their
entrepreneurial journeys.

“Along the way we also roll up our sleeves to
provide additional support to enhance the valuation of these early startups,
including CEO and life science specific roundtables, loaned executives and
regulatory/reimbursement consulting help. Our success is evident in the fact
that our investments of $33M over the past seven years has been leveraged by
our startups to raise over $294M in follow-on funding to date,” stated Dr. Arti
Santhanam, Executive Director of the MII.  

The MII program is a partnership among the State of Maryland, Johns Hopkins University (JHU), Morgan State University, the University of Maryland College Park, the University of Maryland Baltimore and the University of Maryland Baltimore County. The program focuses on funding and supporting the technology transfer process for products with high-commercial upside whose research originated at one of the partner research universities.

The program offers two funding tiers totaling
$265,000 over 18 months. The first tier is for tech validation and market
assessment that lasts nine months and provides $115,000. The second tier
provides $150,000 in funding for company formation and commercial launch,
lasting nine months.

In 2018 alone, MII
provided $4.3 M in funding to seven startups and in
support of 26 technology validation and market assessments. Across its history,
the MII program has invested approximately $33M in 83 startups and 219 technology
assessment projects, resulting in $294M in follow on funding, seven exits and
the creation of 90 full time and 62 part time jobs at an average annual salary
of nearly $97,000.

2019 has seen the program continue to spark
new growth in the (BHCR) by its continued, skillful identification and stalwart
support of high-potential technologies and promising startups with Maryland
roots.

Under the leadership of Dr. Santhanam, MII has
also attracted several notable partnerships, including WSGR, MINTZ, Cooley JP
Morgan, the later two partnering with MII to launch their first ever Capital
Connections investor breakfast series connecting venture capital firms like NEA
to these early stage startups. WSGR continues to sponsor the Entrepreneur Expo
and is in talks to launch a focused life sciences roundtable to help the MII
startups address and assist in their “growing pains”.

Two notable examples of the MII program’s
impact include the recent success stories from AslepiX and Neuraly/Theraly.

With the support of the program, AsclepiX Therapeutics,
Inc., located in Baltimore and led by CEO Wendy Perrow, MBA, has raised $8M in
funding for its novel peptide-based therapies for retinal diseases and cancer.

“The MII program supported and funded us at AsclepiX
Therapeutics, Inc., as a new company. Their early support led to us getting the
proof of concept data, which helped us raise our seed round of funding of $8
million dollars. The MII team of Arti and Jennifer have helped and supported
our team from the start of the company. We are truly grateful to the MII team
for helping us work on medicine to help preserve vision in patients with
retinal diseases and to help cancer patients,” stated Perrow.

Neuraly,
Inc., a Germantown-based biotech company focused on neurodegenerative disease
therapies, was also part of the MII program. Once a JHU spin-out, the company
succeeded in raising $36M in Series A funding. Neuraly was then acquired by
Korean-based D&D PharmaTech along with Theraly Fibrosis, Inc, another MII
portfolio company. In August 2019, D&D PharmaTechannounced a $137.1
million Series B
round, which will help Neuraly advance its neurodegenerative disease clinical
candidate into Phase II trials.

“The MII program provided critical translational research
and seed funding to help us commercialize exciting technology from Johns
Hopkins University,” said Viktor Roschke, Co-Founder of Neuraly and Theraly
Fibrosis. “This early MII funding led us to a $6M SBIR award for Theraly and
successful Series A raises for both companies. The MII program makes Maryland
an attractive place to launch university spin-out companies.”

Other MII Program success stories include:

• NextStep Robotics, a personalized robotic therapy company located in Baltimore, that was recently awarded $5.4M in grant funding.

• Sonavex, another JHU spin-out company, received 510(k) clearance from the U.S. Food and Drug Administration (FDA) to market its EchoMark and EchoMark LP soft tissue markers last year. In March 2019, Sonavex announced it received 510(k) clearance from the FDA for its EchoSure device to deliver definitive blood flow data on demand. 

• Medical device company Coaptech out of Baltimore received FDA 510K clearance for its PUMA-G System, which enables ultra sound-based placement of percutaneous gastrostomy feeding tubes.

The MII fund was named by the Milken Institute Report
as one of the programs helping Maryland retain 3rd place ranking on the State
Technology and Science Index and most recently touted as a successful model for
University technology commercialization program in a report by the Brookings
Institute. With the MII program thriving, and a host of other life
science technology support and funding opportunities available, TEDCO remains a
driving force behind the commercialization of university research within
Maryland and across an ever-expanding range of biohealth-related fields and
industries.

“Seven years ago the
Maryland life science ecosystem was still in its infancy. Since then the
ecosystem has continued to expand and mature in leaps and bounds with more
investment dollars pouring into our startups, the growth of our resident big
Pharma partners like Emergent Biosciences, AZ and biotech infrastructure of
CROs and CMOs like Paragon / Catalent. The ecosystem is more favorable for our
MII startups now to thrive and grow as never before. It is truly an exciting
time to be in Maryland for the program and our portfolio right now,” stated Dr.
Santhanam.

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