SAGE Labs to incubate Nanopore in Westport
by Brian Feldt
A new deal between Nanopore Diagnostics and SAGE Labs could fast-track Nanopore’s drive to commercialization and create a new funding stream for the early-stage company at the same time.
Nanopore is a St. Louis-based medical device startup. SAGE Labs is a Maryland Heights-based laboratory that provides animal models to the research community. It was spun out of Sigma Aldrich in early 2013 and was bought by an investor group led by Telegraph Hill Partners, a San Francisco-based investment firm that closed on a $310 million fund to invest in life science and health care companies in 2013.
Nanopore, winner of the 2013 Olin Cup business plan competition and the $50,000 investment that goes along with it, is developing a test that physicians can use to more quickly detect bacterial infections. The test aims to cut down on antibiotic resistance, which costs the health care industry about $34 billion a year, and to help gravely ill patients who don’t have the time to wait for doctors to determine the best possible antibiotic treatment.
Under the agreement, Nanopore will get lab space at SAGE’s Westport facility, access to it’s equipment and an undisclosed amount of capital for research and development, said SAGE CEO David Smoller. In return, SAGE gains access to Nanopore’s intellectual property and will offer it to its customers for the life of Nanopore’s patent.
The deal gives Nanopore an opportunity to further develop its technology — called The iNDxer — while demonstrating to potential investors the value of the device.
“It allows us to get the service out there while letting us still develop the product,” said Nanopore Co-founder and CEO Tom Cohen.
Cohen said he projects Nanopore to bring The INDxer to market as soon as 2018.
The deal will also give Nanopore an added revenue stream through royalties, which Cohen estimated could add up to about $500,000.
To date, Nanopore has raised $150,000. In addition to winning the Olin Cup, it received a $48,000 i6 grant from BioGenerator in 2013.
Ben Borgo, co-founder of Nanopore, said the company will look to raise another $250,000 in seed capital before the end of the year, which would allow the company to further develop its prototype for the test.
SAGE, which has nearly 50 employees between its two locations in St. Louis and Boyertown, Pennsylvania, has secured similar partnerships in the past, notably an RNA-sequencing deal with St. Louis-based Cofactor Genomics. But Nanopore will be the first company to be embedded within SAGE’s facility, Smoller said.
“We’re not an incubator, but we’re trying to leverage innovation in local communities and partner with companies to drive new offerings for our customers,” he said.