*NEWS: Biomedical Startup Receives Close to $3 Million
An Irvine biomedical company working on an insulin pump therapy for diabetics announced today that it raised about $3 million in a series seed funding round led by the Cove Fund I, with additional participation by a slew of angel groups.
Capillary Biomedical said in a press release that it will use the funds for clinical trials and to gain regulatory approval — to prepare for an expected commercial launch next year.
The company, known informally as CapBio, is developing “advanced infusion sets” for insulin pumps.
The Cove Fund I invested in CapBio because its tech “could well be what enables the whole artificial pancreas market,” Howard Mirowitz, who led the fund’s investment told OC Startups Now.
How it Works
Infusion sets consist of a needle; a thin flexible catheter that carries the insulin from the pump to the needle; and a specialized connector to attach the catheter to the insulin pump. These sets are disposable, and typically must be replaced every three days because the needles become clogged or bent from being poorly inserted into the skin, or by the body’s inflammatory response at the insertion site.
When clogging or blockage occurs, insulin backs up in the catheter under higher and higher pressure from the pump, instead of flowing into the body, causing hypoglycemic reactions. Ultimately, the pressure becomes high enough that the insulin bursts through the blockage, causing sudden hypoglycemia. These rapid changes in body chemistry are “extremely unpleasant and even dangerous,” Mirowitz said.
CapBio’s infusion set technology “greatly reduces the chance of bent needles and inflammation, resulting in smoother and more predictable insulin flow and potentially allowing use for up to seven days before requiring replacement,” Mirowitz said. “The artificial pancreas, which is the next stage of insulin- dispensing technology, uses a glucose monitor to control the insulin pump in a closed-loop system. The reliability of current experimental artificial pancreas systems is limited by the unreliability of current infusion sets, which can’t deliver the insulin with the precision required by closed-loop control algorithms.”
CapBio CEO Paul Strasma added that the company’s infusion set “is a potential game changer in infusion set…technology.”
“It is designed to reduce the various burdens of managing diabetes, such as set failures, discomfort and problems with insertion,” he said.
The company’s core technology was developed at the Jefferson Artificial Pancreas Center at Thomas Jefferson University, with grant funding from the National Institutes of Health and JDRF, the “leading” global organization that’s funding Type 1 diabetes research.
CapBio’s patent-pending infusion set inserter was developed while the startup was in residence at The Cove, the physical space of UCI Applied Innovation, UCI’s innovation center.
In addition to the Cove Fund 1, individual members of Tech Coast Angels (TCA) invested, as did TCA’s ACE Fund. The fund invested $100,000 Managing Partner Ray Chan told OC Startups Now.
“A good CEO makes (an) investment decision easier,” Chan said. “We invested in Capillary Biomedical with the belief that Paul Strasma has the execution skill to lead the company in this long journey.”
TCA members also invested a “significant amount,” David Friedman, a member of the OC chapter, told OC Startups Now.
“Capillary Biomedical is another company that fits into TCA’s parameters of a very good opportunity,” Friedman said. “It has unique technology and an excellent team to manage its growth path.”
About the Cove Funds
The Cove funds are a series of seed stage VC funds. The $5.6 million Cove Fund I began investing in 2015 and has 16 companies in its portfolio. The Cove Fund II launched earlier this year, with $12.6 million, heading toward a goal of $15 million. (See related story here.) The funds invest in early-stage technology and life science companies.