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Two local biotech firms raise $35.5 million in venture capital

Life-science economy picks up steam
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Posted at 6:00 AM, Oct 06, 2016
and last updated 2016-10-06 06:00:17-04

CINCINNATI - A pair of local healthcare startups raised more than $35 million from venture capital investors this week, another strong signal that medical research at the University of Cincinnati and Children’s Hospital can stimulate the region’s life-science economy.

“The technology was always here,” said Bob Coy, president and CEO of CincyTech, a seed-stage investor in local startups. “These two examples demonstrate that the region is maturing in terms of its ability to both launch and capitalize life science companies.”

Enable Injections Inc. set a record with its $30 million Series A financing led by Hong Kong-based ORI Healthcare Fund. It’s the largest amount ever raised by a Cincinnati-based startup for an early-stage venture capital round. The company used Children’s Hospital technology to develop a lightweight injection device that’s easier to use than syringes, enabling fewer dosage errors.

“With respect to delivering high volume biologics, Enable Injections is the pioneer that can change the standard of care,” said ORI Fund founder Simone Song in a press release. “It is very fulfilling to invest in Enable’s technology.”

Enable’s funding announcement came hours after a $5.5 million Series A success by Eccrine Systems Inc. The 20-employee company used technology developed by the University of Cincinnati and the U.S. Air Force to develop a wearable device that analyzes human sweat to monitor medical conditions, stress and industrial toxicity.

“Sweat holds great promise as the best non-invasive source for acquiring the type of physiological insights that the medical community has historically collected and analyzed from blood,” said Eccrine Systems CEO Robert Beech, in a press release. “Advances in microfluidics, nanotechnology, miniaturized electronics and power management are now making it possible to engineer wearable sweat sensing systems to monitor a wide array of sweat molecules in real time.”

Eccrine Systems was recently awarded a $3.96 million contract by the Air Force to develop its next-generation sweat monitor. It raised $5.5 million from a group of mostly local investors, including CincyTech Fund IV.

Coy said CincyTech has nine life-science companies in its 42-company portfolio. That doesn’t count former portfolio company, Assurex Health, which is arguably CincyTech’s biggest success story. The Mason-based genetic testing company was sold in August to Utah-based Myriad Genetics Inc., in a deal worth up to $410 million.

Coy said entrepreneurial talent from Procter & Gamble Co.’s former pharmaceutical division and executives from other Cincinnati-based healthcare companies have been exploring medical-research discoveries for years in Cincinnati. Now, they’re starting to demonstrate the ability to convert those ideas into business plans that attract outside investors.

“The thing about life science companies is they take longer to develop than software companies,” he said. “You just have to be patient.”