How Do Biotech Startups Become Successful?

How Do Biotech Startups Become Successful?

By Yugang Wang

Taking an idea to market, and then to profit is not new, but it’s not a guarantee either.

With the dawn of startups and innovation, we are going to look at three biotech startups success stories. Two started  in academia and then commercialized into biotech companies and the last one is an example from R&D experts.

Pulmotect: Promising Results Backed Up By Professional Management

PULMOTECT is a clinical-stage pharmaceutical company developing a small molecule drug that blocks inhaled pathogenic threats to help people with respiratory issues like leukemia, pneumonia, and asthma. The drug was originally developed by Dr. Burton Dickey, a professor at the University of Texas MD Anderson Cancer Center. Dr. Dickey used academia to start the company, but then outsourced seed grants and startup management from a local biotechnology incubator, Fannin Innovation Studio.

Recently at the Texas Life Science Forum, Pulmotect was nominated for The Ten Top Promising Life Science Companies.

“Access to investors and access to talent,” Emmanuelle Schuler, Ph.D., director of Johnson and Johnson JLABS @ TMC said during the panelist discussion about the keys to bring commercialization to life sciences.

Pulmotect had the talent, and through collaboration, it raised capital that brought this idea to commercialization. To name a few of Pulmotect’s funding, the biotech startup project was awarded a $1 million Texas Emerging Technology Fund (TETF) grant at the first year, followed by a $1.7 million Small Business Innovation Research (SBIR) grant in the second year for the Phase I and II clinical trials. The strong preclinical data combined with an efficient product development program merited a $7.1 million commercialization award from the Cancer Prevention and Research Institute of Texas (CPRIT).

As for progress, according to Pulmotect, the biotech startup has more than $15 million of non-dilutive and lightly dilutive funding leveraging and just over $1 million of equity risk capital.

In less than four years, from the beginning of its discovery, Pulmotect serves as a very successful example of an academic innovation/technology incubator partnership that produced a significant life science breakthrough.

Recursion Pharmaceuticals: From Academia to the Business Industry

Junior professionals also have equal opportunities in the biotech startup culture. RECURSION PHARMACEUTICALS, an emerging drug discovery company, developed a novel drug screening platform by combining experimental biology and bioinformatics. Based on technology developed at the University of Utah,  Recursion Pharmaceuticals has helped medical professionals quickly and efficiently identify suitable treatments for multiple rare genetic disorders. It also aims to efficiently reposition known drugs and shelved pharmaceutical resources to treat rare genetic diseases.

The idea was born when Dr. Christopher Gibson, the CEO and co founder of Recursion Pharmaceuticals, was a MD/PhD student. The company was founded majorly based on Gibson’s own PhD research.

So, let’s see how Dr. Gibson took his idea from academia and launched a biotech company. In November 2013, Gibson and his partners founded Recursion Pharmaceuticals. In spring 2014, Gibson applied for an SBIR Phase 1 and Phase 2 grant. In early 2015, Recursion was awarded a $1.4 million SBIR grant which helped Recursion attract an additional $3.5 million in private investments. The SBIR award and private investments quickly enabled Recursion to establish a core group of employees and a few initial rare disease models. Today, the company continues to grow rapidly.

This is a great example of how a junior scientist applied for a government-backed non-dilutive seed grant and progressively processed the commercialization of a promising technology.

Peloton Therapeutics: A Startup Started By the Pros

The two examples above show how SBIR provided equal opportunities to life science innovators to maximize the impact of their brilliant idea through business development.
For experienced biopharmaceutical professionals, the story is a little different due to their broader connections in the industry, mature project management, and access to diverse resources for innovation commercialization.

PELOTON THERAPEUTICS was founded in 2011 by a group of experienced biopharmaceutical professionals with the aim of capitalizing on untapped biomedical breakthroughs. Compared with Pulmotect and Recursion Pharmaceuticals, Peloton stands out in the competitive biopharmaceutical startup industry for three significant reasons:
The leadership team alone collectively advanced more than 20 drugs into clinical trials prior to joining Peloton.

The R&D practices were supported by more than 25 experienced scientists forming a team with an extensive drug discovery and development track record.

Their financial support stands on variant and solid resources, which have secured more than $60 million in venture capital support besides the non-dilutive CPRIT program.

This is a classical story where a group of talented industry giants startup a new company to commercialize certain intellectual properties with their years of experience and deep insight.

With these biotech startups, the business model is mature, the risk is relatively manageable and the funding is secured. Such stories usually end with commercial exits.


Life science commercialization is no longer a mystery in the maturing technology startup culture. As seen in these three examples, having a competitive innovation and access to available resources with a tailored operation team, have led to successful biotech startups.

Want to learn more about how academia can help you at any stage of r&d? Get started here.
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