Stealthy Vergent Bioscience raises $9m for tumor-fluorescing tech

Vergent Bioscience came out of stealth mode today to reveal a nearly $9 million equity offering for the injectable molecular probe it’s developing to visualize tumors during surgery.

Minneapolis-based Vergent Bioscience’s technology uses a proprietary injectable, tumor-targeting molecule that binds to tumor cells and fluoresces, president & CEO John Santini told MassDevice.com last week at the DeviceTalks Minnesota event in St. Paul.

Based on research by Stanford University chemistry professor Matt Bogyo, Vergent’s VGT309 molecule targets an enzyme called cathepsin that’s found at the periphery of tumors, Santini told us.

“It’s a small molecule; it has a dye on it that’s compatible with all current surgical imaging equipment; it’s activatable, meaning that the probe is off, it doesn’t light up until it hits its target, and then it lights up. And it also has a very unique attribute, unlike any of the others, where it actually binds to the target. So our molecule will float around and actually bind covalently and then light up,” he explained.

The $8.7 million round, which began May 18 and involved 14 investors, was led by Spring Mountain Capital.

“Vergent is developing a much-needed product for the surgical cancer market,” Spring Mountain managing partner Raymond Wong said in prepared remarks. “Positive tumor margins are regrettably common in surgery today and Vergent’s technology has the ability to markedly improve the way that cancer surgery is performed.”

The cash should be enough to carry Vergent through at least a Phase 1A trial and perhaps a Phase 1B2A study, Santini said.

“It provides us enough runway to finish all the things we need to prior to going into [human] and then get the first two trials going,” he said.

The work done by OnTarget Laboratories is a rising tide for all the boats in the space, Santini added.

“They’ve been great. I mean, they’re by far the leader in terms of development. They’ve done a very nice job, sort of outlining what the regulatory path is going to be. And their interactions with the FDA have helped chart the course for everybody in this space, so that we’re not looking at outcomes. So you’re not running trials that are three or four years long, because you’re comparing what’s glowing versus what pathology says is cancer or normal tissue. And so that’s a much quicker trial, it’s a much less expensive trial. And they’ve done a nice job with that,” he said.

Although other companies besides Vergent Bioscience and OnTarget are pursuing similar technologies, Santini said his firm has a leg up for a few reasons, not least a very lean operating structure.

“We’re not building a big management team. We’re not building a big infrastructure for the company. It’s a couple of people, myself, my head of R&D, and a team of key consultants,” he said. “Usually you build a lot. You build your own lab, you build your big management team and all the other things.”

Another factor is that the VGT309 compound will fluoresce under any company’s imaging equipment, meaning Vergent is spared the necessity of developing an imaging device to go with it.

“All the other players are either developing hardware, their own visualization hardware, because their probes aren’t compatible with current hardware or they have concurrent drug development programs. We’re not doing any of that, so we’re keeping it very lean. We’re not doing drug development, we’re not doing hardware development,” Santini said.

Senior editor Nancy Crotti contributed to this report.

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