Private Frazer’s famous catchphrase from the TV classic, Dad’s Army, ‘We’re all doomed!’, seems to have permeated the British psyche.Open any newspaper and it would be easy to believe the last trump is truly nigh.
Life sciences are not immune from the doom and gloom. Fortunately, leading the counter attack against the negativity and championing the success of life sciences and technology is Susan Searle, chief executive of Imperial Innovations. Oxfordshire is one of her key areas.
Imperial Innovations was born in 1986 out of its parent, Imperial College London (ICL), one of London University’s flagship institutions.
Originally formed as the technology transfer company to commercialise ICL’s research and intellectual property, it has broadened into one of the country’s most substantial venture capitalists.
Imperial Innovations funds healthcare and technology projects from proof of concept funding to multi-million pound capital investments.
“Our goal is to create, build and invest in the best companies in their field,” said Ms Searle.
“It is a jigsaw puzzle, fitting together the science, the academic base and its knowledge, a strong management team and the funding.”
Imperial Innovations aims to invest at the very early stage, the earlier the better. Start-ups always struggle for investment, especially as they have no track record, which is why IImperial Innovations is keen to offer modest sums — often around £25,000 — to get things off the ground. The company also has particular expertise at launchpad level.
Continuity of investment is crucial to survival and Innovations can offer that too.
The hunting grounds for the company are the ‘golden triangle’ of Oxford, Cambridge and London, the last concentrating on ICL and University College London (UCL).
In Oxfordshire, Imperial Innovations is deeply involved with some of the powerhouses of the county’s life science cluster.
Circassia is a specialist biopharmaceutical company focused on developing world-class immunotherapies. These include a new class of T-cell vaccines designed to treat a broad range of allergies and therapies to combat conditions such as rheumatoid arthritis and psoriasis.
Imperial Innovations has so far raised £105m for its research.
Abingdon Health has made an investment and acquired a controlling 80 per cent interest in Forsite Diagnostics, a private UK-based contract developer and manufacturer of lateral flow diagnostic products.
Forsite was spun out from DEFRA in 2007. The company has invested in creating a state of the art manufacturing facility which has the capacity to produce millions of lateral flow tests a year.
New parent Abingdon is aggregating medical diagnostics technologies to develop and manufacture point of care tests for a wide range of conditions.
The control of Forsite will allow an end-to-end service, from research to production. Backed by Imperial Innovations, the company has recently completed a £3m funding round.
Imperial Innovations was recently approached by Oxford Spin-Out Equity Management (OSEM), which manages the equity from university spin-outs to optimise returns on investment. OSEM expressed a wish to work closely with Imperial Innovations to create value from spin-outs. As a result, Innovations has become involved with Oxford Immunotec, the Milton Park-based spin-out developing the T-Spot test for tuberculosis.
Immunotec was looking to raise its fifth round of funding to underpin growth of its logistics, sales and delivery infrastructure in the United States.
Imperial Innovations led the funding and of the total £18m raised, invested £6m. Nigel Pitchford, director of healthcare investments, will take a seat on the Immunotec board.
Ms Searle explained: “Immunotec is on the cusp of becoming a world class business and we wanted to be part of capturing the value which will come from this next stage of growth.
“The science, the management and the academic base are all top-notch and that is what we are looking for in a company.”
The Innovations funds are not at all the traditional model for venture capital investment.
In 2002, the company sold part of its stake in its 36 spin-out companies, putting a substantial cash injection into the balance sheet. In 2005, part of Innovations was sold to institutions in a private placement, generating a further £20m.
In 2006, Innovations floated on the Alternative Investment Market, the first listing by a university-based commercialisation company in the UK, netting £26m. A rights issue in early 2012 brought £140m. Since its founding, Innovations has raised £206m.
Because all investments are from the balance sheet, fundings are not controlled in the same way as a traditional venture capital fund. This allows continuity of investment and greater security for spin-outs and start-ups. Sums returned to the balance sheet on exit from investments are reinvested.
Imperial Innovations is flexible in its approach, happily working with other investors and business angels to match investment to opportunity.
They employ prospecting teams who are always on the hunt for quality projects and start-ups. Its recently opened Cambridge office is to soon be mirrored by one in Oxford.
“There is a huge amount of top class science and success in the UK, with Oxfordshire a fundamental part of that. We want to continue at the forefront of investment and management of these flagships,” Ms Searle said.
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