Hartford Business Journal

8 Hartford Business Journal • July 6, 2015 www.HartfordBusiness.com Startup's diagnostics test aims to reshape breast cancer treatment By Matthew Broderick Special to the Hartford Business Journal A s founder and CEO of BioArray Therapeutics Inc., a Connecticut-based cancer diagnostics startup, Marcia Fournier has heard from hundreds of breast cancer patients and their families about the physical, emotional and financial toll that chemother- apy treatments have taken on them. "After the initial diagnosis, about 75 percent of early- stage breast cancer patients undergo chemotherapy," she said. "There's a lot of pain and suffering." Of that 75 percent, Fournier said, only 25 percent will completely respond to the chemo treatment. That prompted Fournier to ask a fundamental ques- tion: What if a patient's response to a particular cancer treatment could be predicted? It's a question Fournier — and the company she founded in 2009 — have been trying to answer. And the diagnostics testing product BioArray has developed — expected to hit the market in 2016 — has not only produced strong preliminary results in clinical trials but has attracted capital invest- ment from a number of Massachusetts and Connecti- cut investors, including Connecticut Innovations, the state's quasi-venture capital arm. "BioArray is taking a unique approach to develop- ing a diagnostic test that could remove the guesswork from breast cancer treatment options and identify the treatment plan that will deliver the best outcome for the patient," said Patrick O'Neill, director of investments for Connecticut Innovations, which has invested $700,000 in BioArray since 2013. "The result of our continued investment in the company could improve the chances of disease-free survival for many patients." The state's recent bioscience infrastructure invest- ment was a main reason, Fournier said, she moved her company from Boston to Connecticut. The Nutmeg State — through UConn's incubator program — also helped BioArray establish its footing. The company originally had lab space in Farmington before recently moving to New Haven. "The incubator program provided us with the physical laboratory space, a strong academic surrounding, and the exchange of knowledge," Fournier said. It also helped with the most urgent resource for any startup: capital. "The program helped connect us with a network of investors who, in turn, helped us hire a staff of four highly trained personnel and helped us develop our product." BioArray's product helps analyze and decode genes and molecules of a cancerous tumor, which, when run through a supercomputer, has shown in a proof-of-con- cept clinical trial of 147 patients to predict the effec- tiveness of treatment with high accuracy and low false negative rates. The clinical trial was sponsored by the National Cancer Institute. "We were able to model and validate our diagnos- tics," she said. "We wouldn't be where we are without that collaboration." Fournier hopes that her company's product will rev- olutionize cancer treatments. "Most predictive testing today is based on telling a person whether they will like- ly get cancer," she said. "We're unique in that our product predicts the effectiveness of cancer treatments." It's part of an evolution in the medical industry — known as precision medicine — that is both grow- ing and attracting federal dollars. In fact, President Obama's fiscal year 2016 proposed budget included $200 million to the National Institutes of Health (NIH) earmarked for precision medicine, including $70 mil- lion specifically for cancer genomics research. Fournier said reducing or eliminating ineffective treatments will not only provide a better patient expe- rience but will save the healthcare system significantly. "The first line of chemotherapy alone can cost $20,000 per patient," she said. "By using predictive diagnostics-based treatments, we could achieve over $1 billion in annual savings in cancer treatment alone." If the potential cost savings are big, so is the market opportunity in the breast cancer industry. In fact, Fourni- er said breast cancer diagnostics is a $1.5 billion a year industry. While there are a number of companies in the diagnostics space, Fournier sees one main competitor for her company: the trial and error method. That's something she hopes to change. "If you treat the patient right the first time [using predictive medi- cine] he or she is less likely to relapse." From her office at Yale University's Science Park in New Haven, Fournier anticipates BioArray will launch its first product within the next 12 months. She said the company has a long-term plan — over the next five years — to expand its diagnostics testing to address other types of cancer treatments as well, but she knows that will take continued investment from outside funders. But capital is only one challenge. "Moving forward, we need to remain flexible to address regulatory chang- es and be able to adapt as we need too." She hopes cancer treatments continue to adapt as well. In fact, she predicts it. n BioArray CEO and founder Marcia Fournier recently pitched investors during a Women in Bio "Shark Tank" event in Boston. FOCUS BIOSCIENCE Q&A CT sees higher interest in bioscience investment Q&A talks about bioscience investment with Margaret Cartiera, director of bioscience initiatives at Connecticut Innovations, the state's quasi-public venture arm. Q: What are some of the key challenges biosci- ence companies face when trying to raise capital? A: The development cycle for bioscience companies can be a long one, which is why it can be difficult to find investors who are willing to invest at the earliest stages of company and technol- ogy development. There are various types of investors (e.g. angels, family offices, venture firms); each has a different "sweet spot" (e.g. preferred invest- ment size, preferred sector, etc.). Bioscience com- panies looking for funding do not always understand the nuanc- es of investors, which presents a challenge to the companies seeking funding. Like startup com- panies in many indus- tries, bioscience companies often have a hard time articulating what differentiates them- selves from others on the market. While the science may be solid, bioscience companies must also be able to show an investor how they will generate revenue and penetrate the market. Q: At what stage in a biosci- ence startups lifecycle should management consider raising venture capital? A: At a minimum, the company should have a minimally-viable product and prototype as well as initial data (e.g., in vitro, in vivo) to validate the approach and the potential of the technology. In addition, key members of the team who will be fundamentally driving the business on a day-to- day basis toward commercial suc- cess need to be in place. Q: What is the current inter- est among investors to co-invest with CI on bioscience deals? How would you compare inter- est in bioscience investment relative to other industries? A: We have seen an increase in applications across the board, but we have also noticed an uptick in applications relat- ed to the bioinformatics and genomics spaces. While the fund does not require co-investors because we are investing at early stages of development, we are seeing applicants in the bioinformatics and genomics spaces that have already received commitments from other investors. Q: What does CI's current pipeline of bioscience deals look like? Does CI have enough capital to meet demand? A: The Connecticut Biosci- ence Innovation Fund (CBIF) has an active pipeline; we are seeing an increasing number of compa- ny prospects with health infor- mation technology and medical device concepts. Yes, we certainly have enough capital to meet the demand. CBIF is CI's newest fund; it is a 10 year, $200 million fund dedicated to the bio- science sector. CBIF helps to drive innovation in the biosciences throughout Con- necticut by provid- ing focused finan- cial assistance to startups, early-stage businesses, nonprof- it organizations and accredited colleges and universities. What we do rep- resents just a piece of the bio- science deals being done. CI's flagship fund, the Eli Whitney Fund, also continues to invest in bioscience. Q: What are you doing to help keep a steady pipeline of bioscience companies? A: In addition to the outreach we do to academic institutions, non-profit organizations and pri- vate companies, we also know that to feed the pipeline, we must start early. We just funded a two-year, $1 million pipeline project—led by Yale's Center for Biomedical and Interventional Technology (CBIT) with key representatives from Yale University, UConn and Quinnipiac University—that will support company, faculty, and student groups associated with Connecticut universities focused on taking their heir concepts to the next level. This project provides the needed gap funding to seedling companies and groups, but it also leverages the entrepreneurial resources that exist within the different university systems. This is the first deal of its kind we are funding through CBIF but it could grow the pipeline of bio- science-related ideas and compa- nies in the state. n P H O T O | C O N T R I B U T E D MARGARET CARTIERA Director of bioscience initiatives, Connecticut Innovations

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