Date: Mar 03, 2014 Author: Don Seiffert Source: bizjournals (
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Don Seiffert
Boston Business Journal
RainDance Technologies today announced the close of a $16.5-million investment to advance its gene sequencing products used for early detection of cancer, inherited and infectious diseases. And while the money comes from all the companies existing investors as well as one new VC firm, RainDance made a point of saying in its announcement of the funding that it now has its "second strategic investor," GE Ventures.
The Billerica, Mass., company said the Series E financing round extension also comes from new investor Northgate Capital, as well as previous investors (Mohr Davidow, Quaker Partners, Sectoral Asset Management, Alloy Ventures, Acadia Woods Partners, Capital Royalty and Myriad Genetics). In total the company has taken in more than $100 million in investment since it was incorporated in 2004. But it singled out GE Ventures as coming on the heels of an investment from Myriad Genetics in 2013, saying both investors "share its mission of addressing healthcare issues by accelerating development and commercialization of products that improve patient care and save lives."
Ron Leuty, biotech reporter at the San Francisco Business Times, spoke last week with Rafael Torres, senior managing director of healthcare at GE Ventures in Menlo Park, Calif., about what it will take for companies like RainDance to stand out as the industry evolves.
What excites you about RainDance?
While next-gen sequencing is a race to the bottom in terms of cost, it creates a number of opportunities for research and the clinical diagnostics markets. There's a large growth in how researchers and clinicians eventually need to deal with understanding genetics and genomics.
There are enabling technologies, like RainDance's, that can become important components in dealing with it — like the digital PCR market and the target enrichment market for companies doing clinical diagnostics tests. That is changing the way disease is being understood and dealt with.
RainDance at the center will create more-efficient operations for them. There are a small number of tests today, but in 10 years there will be a significant number of tests with enriched targets that will require technologies like RainDance's to be efficient operations.
And then there's cancer sequencing. You have the potential of playing in proprietary technologies, like Foundation Medicine is doing very well today. (RainDance President and CEO) Roopom (Banerjee) is positioning the company to really take advantage of these pieces for sample prep and target enrichment and a very good lab instrument for application on the clinical side.
There are a lot of technologies out there, but are we now starting to see the translation of those into actual applications?
We developed our dream of where the industry is going and what are the companies and technologies that will enable the translation of the research into clinical practice. That requires three things: precision — in the clinic, where you can change people's lives; efficiency — in the amount of time and processes that (users) put into these; and cost-feasibility — you're looking in very, very small samples and you need to keep costs under control.
What are the possibilities and pitfalls in moving the technologies into applications?
You've got to be focused. RainDance's leadership has demonstrated that they can execute in a focused way — RainDance brought Myriad in as a strategic investor and they have signed them to also have a supply deal. Today, the market doesn't have hundreds of molecular diagnostics companies applying the technologies. In RainDance we saw they could win the existing, most-promising contracts and be at the center. That's the focus that will lead them to becoming a standard.
What do you make of Illumina's planned genomics incubator in San Francisco? Will that be a bubbling up of these companies translating the technologies?
Yes. We have seen on the content side companies, like Veracyte, which have done a tremendous job at algorithms to solve a problem like thyroid nodules. But the examples are still few. We think we will see innovation on the genomic interpretation side. It will generate a tremendous amount of data, but that data is not being translated, and we're looking to participate in that. We look to work with our companies to grow them and find ways to converge our market presence with them.
