The Maryland Technology Development Corporation is investing a total of $400,000 in two life science companies in the state using funding from its Life Science Investment Fund, one of TEDCO’s seed investment funds.
The two companies — SAJE Pharma based in Baltimore and Rockville-based Promaxo Inc. — will receive $200,000 each. The companies were evaluated by a panel of U.S. Food and Drug Administration consultants, investors and C-level biotechnology and life science executives.
SAJE Pharma has developed a therapy for the treatment of patients with interstitial lung diseases, specifically idiopathic pulmonary fibrosis. The seed fund money will be used toward the next stage of development, including initial safety and pharmacology studies to determine if the therapy is safe to start human clinical trials and ultimately get FDA approval, TEDCO said.
Promaxo is a medical device company developing and commercializing a portable MRI with cellular-level spatial resolution and real-time biopsy and treatment tools. The company’s patented MRI platform technology has successfully undergone a 26-patient safety trial. The seed funding will be used in finalizing the clinical prototype and for phantom and animal validation studies, all with a goal of FDA approval, TEDCO said.
“These ‘lifescience/biohealth’ start-ups face a long runway to commercialization, requiring multiple investment rounds based on critical product development success,” said Life Science Investment Fund Manager Arti Santhanam in a statement. “The TEDCO investments will help these companies bridge the gap to FDA approval while improving their company valuation to help raise capital from sophisticated investors.”
Two of the fund’s portfolio companies have already raised capital following their investments from TEDCO, Santhanam said.
Life Science Investment Fund invests up to $200,000 for a year to support projects that are moving toward commercialization. Investments are made through a five-year, convertible note to the company, TEDCO said.
“The Life Science Investment Fund exists to meet the needs of Maryland companies developing products addressing human health that require approval from the U.S. Food and Drug Administration for commercialization,” stated TEDCO President and Chief Operating Officer John Wasilisin in a statement. “TEDCO’s life science investments enable the companies to reach critical milestones early in their product development efforts, to increase the company’s valuation, and to better position the company for follow-on investment, product commercialization, and job creation.”
TEDCO plans to make five to six investments per year and accepts applications on a rolling basis.