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Biotech Companies Compete for Funding at Minneapolis Venture Capital Event

Posted on: Tuesday, 20 September 2005, 21:00 CDT

Sep. 21--For a St. Paul start-up biopharmaceutical company like PepTx, there's nothing like the prospect of some 50 venture capitalists descending on the Twin Cities.

Especially if, like PepTx, you are among 60 firms to present the case for why you should get venture funding as part of the BIO Mid-America Venture Forum, a regional event that is making its first trip to Minnesota.

"We have an interesting technology platform and a number of what we think are exciting potential drugs," said Brian Jackson, chief financial officer of PepTx. "We're hoping to attract some capital."

The event, which is in its third year, has branched out to include medical-device firms this year -- a reflection of what is a significant industry in its host state and of the emerging trend toward using devices to deliver new biotech drugs.

More than 500 people are expected to attend the meeting, which begins tonight at the Minneapolis Hilton.

Aside from venture capital firms, potential corporate investors such as 3M Co., Medtronic, Pfizer, and Johnson & Johnson, will attend the forum.

BIO, a national biotech trade industry organization, and the biotech associations of nine Midwest states put on the forum. The idea behind it is that while none of the states in the Midwest has a significant cluster of biotech firms -- at least in comparison with the clusters on the East and West Coasts -- together they can create enough heft to attract venture capital .

"We need to think about functioning as a region," said Dan Broderick, a Milwaukee venture capitalist who is head of Midwest Health Investment Network, which helped set up the BIO Mid-America event. "We're stronger together than we are not cooperating."

The first forum was two years ago in Chicago, where some 400 biotech start-ups, investors and other industry participants gathered. Last year, about 500 showed up in St. Louis, including a big increase in venture capitalists from both coasts, where biotech has tended to concentrate. A follow-up study showed that presenting companies at that forum have since collectively secured about $100 million in venture funding.

Pete McNerney of Thomas McNerney Partners, a Minneapolis venture capital fund, says it's difficult to credit one event for a venture deal. Still, he expects some action out of this year's event.

"Some funding will certainly take place," said McNerney, whose firm has helped put together the last two BIO Mid-America forums. "It's all about networking."

Before the forum starts, the University of Minnesota's office of business development will sponsor an event this afternoon at the University Enterprise Laboratories at which 17 Minnesota companies will meet with a variety of venture capital and other investors.

PepTx is one of 11 Minnesota firms presenting their stories to potential investors. The others are Algos Therapeutics and Nanocopoeia of St. Paul; BIOVIRx of Shoreview; CoAxia, Myocor and CVRx of Maple Grove; Discovery Genomics and Excorp Medical of Minneapolis; Medisyn Technologies of Minnetonka, and PlaCor of Plymouth.

Minnesota has the largest number of presenting companies of any state at this year's forum, edging out Wisconsin. About two-thirds of the 60 presenting companies are from the Mid-America association, with the rest from as far away as Texas, Arizona and Canada.

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Copyright (c) 2005, Pioneer Press, St. Paul, Minn.

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HLT,

Source: Saint Paul Pioneer Press (St. Paul, Minn.)

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