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Epidarex closes £102m biotech fund for UK life sciences

Around half of that investment comes from the UK government’s British Business Bank

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A new early-stage funding vehicle from Epidarex Capital is available for UK biotechs, aimed at supporting start-up companies, including spin-outs from universities.

The latest round from the transatlantic venture capital firm has raised £102m ($127m), with around half (£50m) of that total put forward by the UK government’s British Business Bank (BBB) through its Enterprise Capital Funds (ECF) programme.

The Universities of Edinburgh, Manchester, Glasgow and Aberdeen, Strathclyde Pension Fund and other global investors have committed capital to the new fund, said the VC, which notes this is the first time the BBB has committed funds to the life sciences sector.

Epidarex’ last fundraising was in 2014 and was valued at £47.5m, with backers including Eli Lilly – the first time the drugmaker had invested in a UK-focused fund – as well as Kings College London (KCL) and other research institutions.

That fund has backed a number of UK start-ups, including Cambridge-based NodThera, which raised $55m in a series B round for its pipeline of small molecule NLRP3 inflammasome inhibitors, and KCL spin-out Epsilogen, which has started human trials of the first therapeutic immunoglobulin E antibody in advanced cancer.

There are several Scottish companies in its portfolio as well, including Edinburgh Molecular Imaging which raised £3.1m last year to advance its radiotherapy candidates into clinical testing.

The new fund – Epidarex Capital III UK LP – aims to make small investments of £2m to £5m available for “early stage, high-potential life science companies in emerging research hubs”.

It has already agreed to provide start-up funding to Lunac Therapeutics, a spin-out from the University of Leeds, which received £2.65m to develop next-generation anticoagulants to minimise bleeding risk. Other investments will be announced in the coming months, said the fund.

“Epidarex can now significantly expand and support its portfolio of UK life sciences start-ups with the potential to both transform patient outcomes and generate competitive investor returns,” said the VC’s managing partner Sinclair Dunlop.

There was more good news for UK-based start-ups last week when the UK government agreed to top up the Biomedical Catalyst, which also provides start-up funding to companies trying to translate R&D projects into commercial products, with another £30m.

There was a 40% decline in UK biotech funding in 2019, although that was a fall from a record £2.2bn in fundraising in 2018, and the trend overall has been moving steadily upward in recent years.

The fund was also welcomed by Steve Bates, chief executive of the BioIndustry Association (BIA), particularly as it will help balance the spread of the biotech industry across the UK.

“Having transatlantic expertise and a base in Edinburgh gives Epidarex real insight into building new UK life sciences companies, including beyond the South East of England – an area that has traditionally been under ventured despite the presence of world-leading research and innovation,” Bates said.

Article by
Phil Taylor

22nd June 2020

From: Regulatory

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