May 13 2011
SANTA CLARA, California—Cell Biosciences Inc. said it has boosted its Series F round to $33 million and acquired its fourth company in the last 18 months as it continues a strategy of rolling up small providers of protein-analysis tools.
Much of the pharmaceutical industry’s growth is now coming from protein and antibody drugs. These companies are also increasingly looking to use molecular diagnostics to find patients best-suited to their products.
Cell Bio aims to profit from these trends by positioning itself as a provider of tools to analyze proteins that can be used as drugs or biomarkers. Other venture-funded providers of systems for protein analysis or research include ForteBio Inc., whose Octet family of instruments is used to provide rapid analysis of antibody concentrations and other proteins. Cell Bio and ForteBio have a common investor in Latterell Venture Partners.
Cell Bio, of Santa Clara, Calif., has been buying companies with revenue-making protein-analysis tools. On Thursday it said it was paying $9 million cash to acquire Brightwell Technologies Inc. of Ottawa, which sells an imaging tool to detect particles and aggregates in protein drugs.
Last year, Cell Bio bought Convergent Bioscience Ltd., a Toronto-based company that pioneered the use of imaging capillary electrophoresis for protein-charge heterogeneity characterization, a quality-control measurement performed during protein-biologics production.
That deal led Cell Bio to Brightwell, since companies that were using Convergent’s systems were also buying Brightwell’s, said Cell Bio Chief Executive Tim Harkness.
To finance this new purchase, Cell Bio raised $13 million in a second tranche of a Series F financing that is being led by Essex Woodlands Health Ventures. Last year, it raised $20 million toward this round to acquire Convergent. In 2009 it bought venture-backed Protein Forest Inc. and publicly held Alpha Innotech Corp.
In addition to Essex Woodlands, return investors Latterell, Domain Associates, Lansing Brown Investments, Novo A/S, Royal Bank of Canada and Vertical Group also participated in the second-tranche financing.
Cell Bio plans to continue buying companies that can be acquired for $5 million to $15 million, Harkness said. There are many players with interesting protein-analysis tools that have reached a point where they need significant investment to scale up their sales, according to Harkness.
Selling themselves to Cell Bio, which has raised $60 million in the last 18 months to finance acquisitions, is one option for them. Cell Bio targets growing, revenue-making companies. Brightwell will draw about $5 million in 2011 revenue.
This year, Cell Bio expects its revenue to be more than $40 million, up from about $25 million in 2010, Harkness said. He declined to discuss valuation.
By Brian Gormley