NEW YORK, April 18 - German functional genomics startup DeveloGen has raised 40 million euros ($35 million) in a round of private financing, the company said Wednesday.
The funds will go towards expanding the company's in-house technology platform for identifying genes related to diabetes and obesity, as well as allow the company to branch out into new areas of disease, including cardiovascular disease, said Ed Stuart, DeveloGen's COO.
"We're planning to broaden the scope of the company, [as well as] go into developing a program based on the genes we've discovered already," Stuart said.
DeveloGen's technology is based on the developmental biology research of the company's academic founders at the Max Planck Insitute for biophysical chemistry, in Goettingen, Germany.
Founded in April, 1998, the company, which is also based in Goettingen, identifies disease-relevant genes by studying the evolution of gene function by studying three successively more complex model organisms: fruit flies, zebrafish, and mice.
The company's DevelopScreen platform studies the genomic attributes of lower species in order to identify genes that are relevant to human health, while the DeveloVec technology enables the genes to be delivered to target cells as part of the company's effort to develop therapeutic products.
"We have all the major model organisms in-house and the bioinformatics to take all the information from one animal and put it into the next one," said Stuart.
DeveloGen currently performs functional genomics research in obesity and diabetes for several small undisclosed European pharmaceutical companies, Stuart said. With the current financing, the company shouldn't have to rely too much on pharmaceutical companies at this stage, he added. "We can wait to build our technology before we have to worry about partnering," he said.
Dresdner Kleinwort Capital led the financing round, the second for the company after an initial $3 million raised in 1998. Breslin Biotech, Deutsche Venture Capital, Commerz Beteiligungsgesellschaft, and other current investors in the company also contributed to the round.
"[DeveloGen] has a faster way of identifying genes that are important," said Danny Green, a director at Dresdner Kleinwort Capital in London. Identifying a large number of genes that are up or down-regulated in a disease tissue isn't as valuable as identifying genes that cause certain phenotypes, he added.
"The challenge now is to get qualitative information," Green said.