Capital Specializes in Funding Neuroscience Firms
by James Cavuoto, editor
cannot boast having as large a fund or as well known a name as some
of the Sand Hill Rd. firms on the west coast. But the Virginia-based
firm can claim to be the largest, and perhaps the only VC firm to
target the neuro space exclusively.
NeuroVentures management includes two professionals with a well
meshed combination of skills and experience. Managing director Mark
Cochran worked in the pharmaceutical industry for many years, including
stints as vice-president of business development for Bayer Pharmaceuticals
and at MicroGeneSys Inc., a biotech firm he founded. Cochran earned
his Ph.D. from Queens University in Canada and has done post-doctoral
work at the National Institutes of Health. He was previously in
charge of the San Francisco office for MDS Capital Corp., a Toronto-based
VC firm with $600 million under management.
Director Daniel OConnell has worked with several medical and
healthcare startups, including MedSpecialists, Inc., a clinical
ASP for medical specialists, and Surgical Solutions, LLC, a company
dedicated to commercializing neurosurgical products developed at
university research laboratories.
The firms medical and scientific advisory board is a virtual
whos who in neuroscience, including Floyd Bloom, chairman
of the department of neuropharmacology at The Scripps Research Institute
in La Jolla, CA and CEO of Neurome
Inc., Zach Hall, the former director of NIHs National
Institute of Neurological Disease and Stroke, William Mobley, chair
of the department of neurology and neurological sciences at Stanford
University, and Donald Price, professor of pathology, neurology,
and neuroscience at Johns Hopkins University School of Medicine.
As of this point, NeuroVentures has invested in seven companies
in the neuro space. These investments include both device manufacturers
and drug discovery firms in the neuro space. In the latter category
are EnVivo Pharmaceuticals,
Inc., a San Francisco firm developing small-molecule compounds
for treating neurodegenerative diseases, Kadmus
Pharmaceuticals, Inc., a Menlo Park, CA firm developing compounds
to treat chronic pain, and David Pharmaceuticals, Inc., a Half Moon
Bay, CA firm working on compounds to treat memory loss.
Device companies in NeuroVentures portfolio include Concentric
Medical, Inc., a Mountain View, CA firm developing products
for stroke intervention, and SpineWave,
Inc., a manufacturer of products for the spinal market.
NeuroVentures has targeted the neuro space because they see an enormous
opportunity in treating neurological and psychiatric diseases and
disorders, particularly as the graying of the population continues
to exert influence on the prevalence of these disorders. The firm
also believes that research initiatives such as the Decade of the
Brain and the Human Genome Project have brought to the forefront
new tools and opportunities for neuroscience firms.
Looking specifically at neurotech devices, OConnell believes
there are many advantages available to neurostimulation and neurodiagnostic
firms, despite the prevalence of orally delivered small market therapeutics.
One factor in devices favor is that CNS drugs often pose delivery
challenges, side effects, and limitations in universal effectiveness.
He also notes that devices often offer a faster and cheaper path
to market than pharmaceuticals, and can bring a large degree of
technological innovation to the table. The market segments with
the greatest opportunity for neurotech devices are stroke, pain,
epilepsy, Parkinsons disease, and depression, according to
OConnell. He believes that neurotech startups such as Vertis
Inc., and NeuroPace offer
examples of emerging companies to watch.