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Sphere Fluidics is an established Life Sciences company which has developed unique products for use in single cell analysis and characterisation and provides collaborative R&D services in this area.

The company was founded on IP generated by the University of Cambridge and has in-licensed 10 patent families from the University and other leading institutions. The core technology is now protected by 51 patents and has been developed with £2.3m of equity and over £7m of grants.

The pharmaceutical industry has a deficit of new drugs and is suffering from aging drug patent portfolios and a related rise in the selling of generic drugs by their competitors. As a response, pharmaceutical firms are now moving away from chemical (also called small molecule) drugs towards significant investment in biological drugs (biopharmaceuticals), stem cell therapies and areas of unmet medical need (e.g. cancer). Those companies need new technologies to enable acceleration of their research and development. Sphere Fluidics has developed a new technology platform for single cell analysis and characterisation which enables the discovery and development of new biopharmaceuticals and cell therapies and novel ways to study diseases, such as cancer. Sphere Fluidics can find that rare “one in a billion” molecule or cell type that could be an industry blockbuster. Also, compared to conventional approaches, their technology is very fast and highly miniaturised - offering tremendous cost-savings.

Sphere Fluidics provides high value R&D services for single cell analysis and characterisation and has successfully commercialised 55 unique products in this area.

More detail can be found on the company's website here.

The Opportunity

Sphere Fluidics is operating in the single cell analysis and characterisation market in which there are one million miniaturised tests per day per biochip (source: Sphere). Their main market, biopharmaceutical discovery and development tools, is worth over £2.9 billion annually with a growth rate of 15% per annum. This market is of significant interest to all major pharmaceutical companies. The company has already secured customers, demonstrating initial market traction. In its next phase the company plans to fund development of novel instruments for wider sale. Burn rates will be offset by ongoing R&D Services activity. Development of the instrument business is critical for accelerating related consumable sales and scaling of the business.

The Markets

1) Biopharmaceutical Discovery & Development Tools

     £.2.9 billion growing at 15% p.a.

2) Single Cell Disease Research

     e.g. Infectious Diseases: £1.7 billion p.a.

3) Bioprocessing Improvement

     e.g. Synthetic Biology segment: £215 million growing at 43% p.a.

4) Single Cell Diagnostics and Prognostics

     e.g. Circulating Tumour Cells: £2.8 billion growing at 19% p.a.

Progress

Since the last funding round in 2013, the company has made strong commercial and technical progress across various fronts, including:

Potential contracts closing 2014:

• Top 10 Pharma co. in synthetic biology
• Pharma co. / University in synthetic biology
• Top 5 Biopharma co. in BioPharmaceutical development
• Top 10 Biopharma co. in BioPharmaceutical development
• Top 5 Pharma co. in Antibiotic-Resistance studies
• Total potential sales pipeline FY 2014-2015 containing 30 organisations: £8.6m, with currently predicted actual sales in this FY: £1.7m

Grants:

• TSB Grant (MedImmune) for MAS Devt - £405K (£192K to SF) -WON
• TSB Grant (Imperial College) - £325K (£140K to SF) - WON
• 3 x EU H2020: £14 million in total - Potential SF Funding: £2.5m

Management / Team

Dr Andrew Mackintosh, Chairman, was CEO of The Royal Society Enterprise Fund and previously CEO of Oxford Instruments plc.

Dr Frank F. Craig, CEO, was previously CEO of Smart Holograms, VP R&D Amersham Biosciences, VP Aurora Biosciences, and a Senior Scientist at GlaxoSmithKline. He has been involved with co-founding biotech start-ups with a market capitalisation of £1.7bn, raised £18m of VC/angel money and delivered circa £180m in recorded sales.

Professor Chris Abell, Co-Founder, is currently Head of Cambridge University Microdroplets Group. Previously co-Founder of Astex Pharmaceuticals.

Professor Wilhelm T. S. Huck, Co-Founder, is a world expert on soft lithography and holder of an ERC grant on “Microdroplets in Microfluidics. Based at Cambridge University and Radboud University.

Dr Marian Rehak, Director of Research and Development, is responsible for management of all R&D activities at Sphere Fluidics. He has a strong background, and more than 20 years’ experience, in industrial and academic research and development environments.

Dr Rob Marchmont, Commercial Director, brings to Sphere Fluidics more than 25 years’ experience in privately-owned and publicly-traded Life Sciences companies. He has a proven track record in business development, technical selling and strategic marketing.

Valuations as of 10th June 2014. Net NAV includes income tax relief and fees on investment

Parkwalk’s current portfolio consists of 27 companies, which have raised in excess of £250m of funding between them since 2010 and over 600 patents protect their technology and processes.
Overall, Funds I-IV’s portfolio comprises of 9% Series ‘A’, 33% Series ‘B’, 25% Pre-IPO and 33% AIM listed.  

Past performance is no guide to future performance. The price of a fund can fall as well as rise. Investors may receive back less than originally invested.