On-Q-ity, which raised a $26 million Series A round back in December 2009, quietly folded its tents last year after an unsuccessful bid to develop its technology for personalized cancer detection.
Bruce Booth, a partner at Atlas Ventures, 1 of the VC shops that backed the company (and a member of On-Q-ity’s board), detailed the reasons behind the decision this week on his blog, Life Sci VC.
Formed by the union of a pair of venture-backed firms that couldn’t raise Series B rounds during the arid summer of 2008, Waltham, Mass.-based On-Q-ity sought to develop personalized cancer biomarkers and a device to capture and characterize circulating tumor cells based on technology from its predecessors, Cellective Diagnostics and The DNA Repair Co.
Sign up to get our free newsletters delivered straight to your inbox
But after On-Q-ity burned through some $15.6 million of the $26 million Series A financing in a futile bid to develop DNA repair biomarkers, Booth wrote, there wasn’t enough left in the till to cover the cost of a pivot toward the CTC technology.
"By mid-2010, only 6 months after the Series A came together, it was clear that the DNA repair biomarkers were going to be tough, as an early trial failed to reproduce the nice Kaplan-Meyer curves of the original academic work. By late 2010/early 2011, 2 more larger trials read out negatively so we decided to terminate that effort. But unfortunately those trials and the biomarker lab work required to support them consumed 60%+ of the capital in the Series A round," Booth wrote. "As we dug in to the status of the CTC platform, it was very clear that lots more work needed to be done – the paper descriptions of what it was supposed to deliver didn’t map to the platform’s actual robustness (or lack thereof) at that time. Antibodies that were supposedly functional turned out not to work, and several other things like this. An early LabCorp partnership fizzled because of this realization. Our new CSO and the R&D team rebuilt much of the platform and reagents from scratch, got it up and running in a reproducible and robust manner, validated it favorably against Veridex’ CTC approach with patient samples, and set us on sound technology footing. It was an impressive technology turnaround, frankly. But that took a year, and a very precious year. We were out of money at the start of 2012."
The sale of On-Q-ity’s remaining patents and intellectual property assets is just winding down now, according to Booth.
Trans1, Baxano extend merger deadline
TranS1 (NSDQ:TSON) and Baxano extended the deadline for their $24 million merger, pushing the date for either party to terminate the deal from April 30 to May 31 – and an amendment that would allow Baxano to ask for a $2.5 million bridge loan to cover costs in the interim.
Read more
NxStage completes shift to direct sales in UK
NxStage Medical (NSDQ:NXTM) said it completed its move to direct sales in the U.K., but maintained a relationship with its erstwhile distribution partner there, Kimal plc.
"We are excited to expand our direct operations into the U.K.," founder & CEO Jeffrey Burbank said. "As the next step in our international growth strategy, this move presents us with the opportunity to build upon Kimal’s success, strengthen our relationship with customers, and more rapidly take advantage of new product approvals."
Read more
Incline Equity deals Orthotic Group to Frazier Healthcare Partners
Incline Equity Partners, a Pittsburgh-based private equity shop, sold The Orthotic Group to Frazier Healthcare Ventures for an undisclosed amount.
Read more
Cerner logs 52-week high
Shares of Cerner (NSDQ:CERN) reached a 52-week high of $96.24 yesterday and is flirting with beating it today. CERN shares, which opened up a hair at $95.94 apiece, were dead even with yesterday’s close as of about 9:50 this morning, trading at $95.54.
Analysts’ ups and downs
- Abbott (NYSE:ABT): Jefferies raises price target from $40 to $42, maintains “buy” rating.
- Abiomed (NSDQ:ABMD): Piper Jaffray downgrades from “overweight” to “neutral” rating.
- Haemonetics (NYSE:HAE): Zacks downgrades from “outperform” to “neutral” rating with $43 price target.
- Hologic (NSDQ:HOLX): Stifel Nicolaus initiates coverage with “hold” rating.
- Johnson & Johnson (NYSE:JNJ): Jefferies raises price target from $79 to $85, maintains “hold” rating.
- St. Jude Medical (NYSE:STJ): RBC Capital downgrades to “underperform” rating, maintains $37 price target.
