In an effort to deliver the benefits of medical discovery to patients seeking relief, the Wisconsin Economic Development Corporation (WEDC) has awarded a $140,000 grant to Bridge to Cures (B2C), a new nonprofit, to establish a new seed fund. The matching grant will enable B2C to provide seed money to entrepreneurs at academic institutions in southeastern Wisconsin seeking to translate their medical research and inventions into products and companies in the healthcare space.
The grant will provide financial assistance to four healthcare startup companies annually through the Bridge to Cures Health Care Innovation Fund. Two would focus on products, such as pharmaceuticals or medical devices, and two would focus on services, such as clinical and diagnostic services.
The goal of the seed fund is to take an advanced medical concept developed at a university and help it grow to become viable for venture capital funding within two to four years.
In addition to seed funding, the four companies also will benefit from the strategy and experience of the three founders of B2C, academic drug development scientists who collectively have helped raise more than $150 million in venture capital and federal funding for past initiatives.
“The core strategy of B2C is to deliver exceptional experience on entrepreneurial finance to emerging biomedical ventures,” said Doug Stafford, chief business officer and co-founder of the University of Wisconsin-Milwaukee. “This way, a startup will have the best chance of receiving subsequent venture capital funding.”
A key to success is a strong partnership with academic institutions in southeastern Wisconsin that focus on translational research. B2C has formed an alliance with The Medical College of Wisconsin, the University of Wisconsin-Milwaukee, Concordia University, the BloodCenter of Wisconsin, Marquette University and the Milwaukee School of Engineering—an initiative that builds on more than $200 million in federal grant awards these institutions receive annually for healthcare research. This alliance is through a recently formed inter-institutional drug discovery partnership created by the Clinical and Translational Science Institute.
“This effort is unique in that it crosses institutional boundaries, and encourages collaboration and synergy to accomplish a goal that would be much more difficult for any of the partners to achieve on its own,” said John R. Raymond Sr., president and CEO of the Medical College of Wisconsin.
WEDC and B2C officials say one area the program hopes to emphasize is the development of new drugs. With pharmaceutical companies scaling back on their R&D efforts, more of that work is being done in university research labs. The new seed fund is expected to help bring new drugs to market.
“As the pharmaceutical industry emerges from the most dramatic downsizing in its history, due to shrinking drug development productivity, it is increasingly turning to in-licensing innovation from startups as the future source of new medicines and devices,” said Daniel Sem, co-founder, CEO and president of BC2. “We aim to seed and grow these startups in southeastern Wisconsin by pioneering a new model in public/private and academic/industry collaboration that will bridge the gap between academic basic research and industrial development.”
To help achieve its goals, B2C’s founders have engaged Wisconsin and coastal venture capitalists and serial entrepreneurs to serve on an investment committee that will help select the four companies that will receive the seed funding.
Reed Hall, secretary and CEO of WEDC, said the initiative is part of the organization’s overall strategy to help commercialize the R&D at Wisconsin’s educational institutions. WEDC and the University of Wisconsin system recently announced the creation of Ideadvance, a $2 million seed fund to help commercialize technology and ideas developed at UW campuses statewide. Both initiatives are part of WEDC’s Capital Catalyst Program, which is investing $1 million this fiscal year in similar efforts.
“Even with an abundance of world-class research taking place at Wisconsin’s public and private universities, comparatively few ideas and products are being successfully commercialized into new business ventures,” said Hall, who heads the state’s lead economic development organization. “WEDC wants to ensure that more startups stay on track and reach that critical stage of commercialization, which help create and grow more businesses, and generate more jobs across the state.”
Applicants will be accepted for the program later this year. The investment committee will choose the top proposals among those submitted and those companies then will be asked to submit a business plan. Throughout the selection process, the finalists will receive mentoring and training from B2C as they develop and refine their business plans.
In the final stage, top applicants will take part in a Wisconsin Healthcare Innovator Pitch event, where they will present their ides to the investment committee in a format that simulates a presentation to venture capital investors.
The top applicant in the product category will receive a $200,000 grant as well as obtain access to space in the B2C headquarters at UWM’s new Innovation Campus in Wauwatosa. The top service company will receive $42,000 in funding as well as space at the campus.
In addition, a $28,000 grant would be provided in the product category, and a $12,000 award will be given in the service category.