By Shaoyu Chang, MD, MPH, Senior Research Manager & Asia Business Development Liaison, LSN

Asia-based drugs, devices, diagnostics and healthcare IT companies all have a cross-border strategy. These entities have demonstrated impressive growth in recent years in terms of talent, research capacity and capital. Now on both sides of the Pacific Ocean, investors and entrepreneurs have set out to find opportunities and form new partnerships. At the Boston-Cambridge biotech hub, the tenth RESI Conference is poised to become the go-to platform for US-Asia early stage life science investments.

Life Science Nation has teamed up with a committee of highly experienced investors and organizations to implement the new Asia Track at RESI Boston. Interested attendees will have the opportunity to learn about the Asia-North America investment landscape and meet face-to-face with potential partners in biopharmaceuticals, medtech, and diagnostics.

The steering committee is composed of representatives from Wuxi Apptec, Simcere Pharmaceutical, Lyfe Capital, MP Healthcare Venture Management, Korea-Seoul Life Science Fund, Chinese-American Biomedical Association (CABA), and Sino-American Pharmaceutical Professionals Association (SAPA). The committee brings together diverse backgrounds and deep experience in early stage life science investments.

The LSN team has traveled to innovation hubs such as San Francisco, Houston, Toronto, and Boston. Everywhere we went, we were greeted by a growing number of Asia-based investors, fund managers, pharmaceutical corporations, and big corporations that are looking outside their local region for investable life science technologies. However, geographic and cultural barriers often limit their ability in deal-sourcing, evaluation, negotiation, and post-investment management.

On the other hand, many US and Canadian entrepreneurs are looking at the other side of the Pacific for capital, strategic partners, and business growth and expansion. They are faced with a different set of challenges: ignorance of risks and benefits in these new marketplaces, inability to identify a good fit from a wide array of advisors and consultants, and difficulty in establishing and maintaining long-term cooperative relationships.

The Asia Track at RESI Boston aims to address all of the above issues. Past RESI events have stressed the globalization of early stage life science investments. This time, the Asia Track will bring to you seasoned investors who understand your sector and can pinpoint emerging opportunities in China, Japan, Korea, and other Asian countries. Next Phase will announce these Asia investors panels in the coming weeks.

By Caitlin Kramer, Research Analyst, LSN

As Life Science Nation’s 10^th RESI Conference approaches, we are proud to offer a glimpse into the topic of a new panel which will debut in Boston on September 13^th: Big Data in Healthcare. This panel will feature the insight of five investors actively seeking companies that are advancing big data solutions to problems in healthcare and medicine.

The paradigm of digital information is still relatively new, and techniques for dealing with massive quantities of it – Big Data – are still in their early stages. LSN asked investors for their thoughts on the space, and their responses are below.

What is exciting about big data? What role do you see it playing in the future of healthcare?

One of the areas I continue to see active investor interest in is companies working with patient data. There’s a lot of excitement about innovative solutions that help patients and practitioners securely manage and share medical records and data while still maintaining regulatory compliance. This extends into the insurance industry as well.

I’ve also found the application of big data-native concepts like computer vision, machine learning, and natural language processing to the medical field incredibly interesting. Examples include technologies that help doctors diagnose diseases earlier based on a programmatic analysis of medical imagery, or a cross-correlation of 200 million patient records looking for subtle trends, or a mental health patient conversing with a digital psychologist AI to help set some context before scheduling a meeting with a licensed doctor.

Another investor said:

I believe that within my lifetime, it will be considered malpractice for doctors to diagnose without using computational aid. Systems biology is too complex to be held in the brain, and AI will become a routine, standard part of medicine.

With so much excitement about the potential big data has to transform healthcare, the space is prone to hype. Entrepreneurs should keep in mind the unique challenges of working in the space, especially when speaking with investors. This led us to ask:

What are the biggest hurdles you see to using big data in healthcare?

An investor we spoke with countered with another observant question:

Why hasn’t there been a big medical breakthrough or discovery yet, despite billions of dollars already invested in big data AI and machine learning?

He continued on to discuss why:

Most big data projects indiscriminately mine data without considering uncertainty. These can be uncertainties in measurement, biological variability, or patient comorbidity. When I ask CEOs of big data companies simple questions about how they plan to deal with mismatches in ontology, or error propagation, I am often met with a blank stare. Medical science, done well, requires setting up an experiment, making measurements, accounting for uncertainty in measurement, and propagating that uncertainty. To effectively do that at this stage, we need to first focus on developing algorithms that work on small data with constraints, and a scope confined to the clinical question.

Another core component to developing big data algorithms for use in healthcare is recognizing that the needs of the algorithms differ from those applied in other fields. A failure to correctly classify or categorize a piece of information used in a marketing or financial setting can be corrected later, while the failure to distinguish between a benign and malignant tumor image can cost a life when applied in medicine. The mentality of software development needs to understand the consequences of error.

Important insights and opinions such as these will ultimately shape how big data manifests a presence in healthcare in the coming years. We look forward to announcing the panelists for Big Data in Healthcare in the coming weeks, and to hearing more investors speak about their experiences investing in this new and exciting future for medical care at RESI 10.

By Caitlin Kramer, Research Analyst, LSN

Advances in computer science and engineering in recent decades mirror and enable advances in the life sciences. The trends of miniaturization, massive parallelization, and faster processing are now applicable to cell handling, and investors are therefore taking a keen interest in this rapidly developing field.

Current instruments aim to separate and enrich desired cells from complex matrices using smaller sample sizes, all while shrinking device size to handheld or benchtop scale. Many of these new technologies make use of microfluidics and/or microelectromechanical systems (MEMS) which employ microscale electric, acoustic, or magnetic fields to separate cells on the basis of character.

These novel cell sorting and isolation technologies have applications in R&D in CRO, pharma, and academic settings, as well as in point-of-care clinical settings. The LSN Company Database contains 285 companies with a description containing “cell separation” and “chip”. A breakdown of these companies by sector (Figure 1) shows an emphasis on development of technology for use in the R&D or industrial settings, followed by chips developed for use in medical care.

Within the LSN Investor Platform, we have identified 520 investors with a potential interest in “biochips” and “screening” for use in R&D Settings (Figure 2). Of these investors, private equity groups are the most prevalent followed by venture capitalists. The high level of interest shown by private equity groups is indicative of technologies that are becoming mature; PE groups feel comfortable and interested in providing later stage funds to companies seeking growth, expansion, and buyout. The second most prevalent investment type is venture capital, which speaks to the continuing interest in developing novel chip technologies.

A breakdown of investors and companies by country (Figure 3) using the results of the aforementioned searches shows that the US, Germany, and China are leading in numbers of early stage companies with cell sorting chip technology. The greatest number of investors interested in these technologies are located in the US, followed by investors in the United Kingdom. However, many of these investors are looking globally for investment opportunities.  German cell sorting chip investment opportunities notably outnumber local investors, meaning Germany-headquartered companies might need to look abroad for investors.

Cells isolated from their endogenous origins – bodily fluids and tissues, ground water, soil, etc, are truer representatives of nature and therefore have great advantage as research and diagnostic subjects. This growing awareness has resulted in a gradual shift away from stock strains, and is relevant to antibiotic drug discovery, microbiome research, cancer diagnosis, and personalized medicine. The cell sorting market is predicted to grow to $6.3 billion by 2020, and the space is becoming more competitive as new technologies hit the market and gain traction with researchers. LSN will be looking for future developments in this increasingly crowded landscape.

By Lucy Parkinson, Director of Research, LSN

18 months ago, Next Phase took a look into assets under development in the neurology space. Revisiting that sector now, we see some fields moving ahead in spite of the great challenges involved in the development of neurology assets.

Drawing on a sample from the LSN Company Platform of assets under development worldwide, we can take a look at the top areas in both diseases of the nervous system and in mental and behavioral disorders. In diseases of the nervous system, this sample includes 647 assets, of which 464 relate to a specific clinical area, as shown in Figure 1 below:

Alzheimer’s disease remains the field with the most assets under development, in spite of continuing setbacks in late-stage trials. However, among other top areas of neurology, Parkinson’s disease has undergone market pipeline growth, overtaking MS to become the second largest developmental pipeline in neurology. With large pharma companies taking increasing interest in Parkinson’s disease, we can expect significant competition in the future if these programs are successful. We also see a substantial increase in development of treatments for neuropathies. This may reflect the increasing rate of diabetes, a major population health concern that has attracted the interest of scientists and investors.

There remain many rare neurological diseases in which few cures are under development; however, there are now treatments under development for two of these rare diseases that we highlighted previously as having no potential cures within our data sample, Charcot-Marie-Tooth disease and Steinert disease. Given the strong investor interest in drugs that qualify for orphan designation, we hope to see treatments entering the clinic in the future in other rare neurological conditions.

In the field of mental and behavioral disorders, the LSN Company Platform sample includes 146 drug assets. Schizophrenia and depression remain the most crowded pipeline areas; however, there are an increasing number of drugs under development to treat addictions.

We still see new neurology therapeutics being developed by startup companies worldwide. The US remains dominant in neurology innovation, but China has seen an increase in neurology innovation. Figure 3 below shows the top 10 countries for clinical stage neurology assets.

In spite of the well-known challenges in the sector, there remains significant investor appetite for neurology therapeutics, with investors chasing potential blockbusters in disorders that currently have few or no treatment options, such as Alzheimer’s disease and Parkinson’s disease. The LSN Investor Platform now includes detailed mandate information from 362 investors that are interested in clinical stage assets in neurology. 150 of these investors are looking globally for deals, and others are looking in several different regions. The below chart shows the number of investors we’ve contacted who are looking for deals in each region:

Neurology remains a very active area for therapeutic development, with many severe diseases, some of them widespread, currently lacking any disease-modifying treatments. However, there are well known difficulties in bringing a product to market in neurology, including the difficulty in identifying the right patient populations for late stage trials. LSN will be tracking these assets through the pipeline, and will continue to reach out to investors who are focused on the future possibilities in neurology.

By Dennis Ford, Founder & CEO, LSN

The first Redefining Early Stage Investments (RESI) Conference took place on September 16, 2013, and three years later, following highly successful events in San Francisco, Houston and Toronto, RESI will return to Boston for the 10th RESI Conference. Life Science Nation will be hosting the RESI Boston conference in collaboration with Johnson & Johnson Innovation, JLABS on September 13th, 2016.

RESI Boston is a venue for entrepreneurs to meet with 10 categories of investors that LSN tracks including Family Offices, Corporate Venture Funds, Angel Groups, Venture Philanthropy, Venture Capital and more. Through the RESI Partnering, fundraising executives can have up to 16 scheduled meetings as well as many more ad-hoc meetings with diverse life science investors who fit their company’s technology sector, indication and stage of development. Additionally, through an expansive series of panels and workshops, attendees will have the chance to hear firsthand accounts from investors explaining their current investment mandates and process for identifying and qualifying candidates.