CytoSeek chases cell therapy’s holy grail

Adam Perriman, professor of bioengineering at University of Bristol, is every tech transfer professional’s dream faculty member. He gained his PhD from Australian National University in 2007 – not long before the global financial crisis threw the world’s economies into turmoil – and immediately began pondering the benefits of spinouts, which were still a rarity at the time.

“Things were looking rough in 2008,” he told Global University Venturing. “I was looking at the world and realised that the west does not really have anything left. If we do not start commercialising all this science – and very little was making it out beyond publishing at the time – then where does the value lie?”

Although long proven right, with spinouts an increasingly important component of knowledge transfer across the world, it would take almost a decade before Perriman found his own perfect opportunity in 2017: CytoSeek. He came up with the name when he participated in University of Bristol’s 4-Day MBA programme with a view of launching a business, he disclosed.

CytoSeek’s technology, he explained, “is centred on artificial membrane binding proteins. We design these protein constructs, which comprise an anchor domain that binds to the plasma membrane of cells and a functional domain that is the moiety we use to introduce added functionality to a cell.

“The functionalities that we introduce are associated with the challenges of treating solid tumours with cell therapies. For example, we can augment the cells to improve their performance in hypoxic environments – think of it as little scuba tanks we put on the cell. We can switch them on or off, which you want, for example, for T-cells.

“In practice, what we do is have the cells in vitro and put them in with a media, leave it on for 15 minutes, take it off and they are good to go.”

Initially, Perriman’s interest lay in stem cell therapies for the treatment of postmyocardial infarction, and CytoSeek’s original intellectual property was about modifying stem cells for treatment after a heart attack, he recalled. But a consultant – hired at the behest of Bristol’s senior research commercialisation manager Andrew Wilson – cautioned the market opportunity for cardiac cell therapies was not worth pursuing because there were no approved treatments and nobody really understood how they might work.

However, Perriman said, CAR T cell therapy did have “one approved product and a second was just being approved but it did not work for solid tumours, so that gave us a clear industry focus. We also had a clear problem that we could address with our technology.”

The focus on solid tumours, Perriman explained, was because these accounted for around 85% of deaths by cancer. CAR T cell therapy, he said, also already worked for certain types of leukaemia.

“Our approach is a bit of a holy grail,” he declared. “If we can adopt cell therapy to solid tumours, it is going to have a massive impact. This made it a good market with an unmet challenge, and our technology is extremely flexible and could address many different components.”

Carolyn Porter, chief executive of CytoSeek, clarified that there remained an opportunity for improving cell therapies in the field of liquid tumours, adding: “Although our preclinical programme is focusing on proving the technology works in the context of solid tumours that does not mean that we might not do a partnership in the field of haematological malignancies in the future.”

She stressed that CytoSeek did not see itself turning into a company such as Autolus, the cancer-focused biopharmaceutical spinout from University College London that collected $150m in an initial public offering in 2018 and that had invested large sums into building its own manufacturing capabilities.

“We anticipate that we will be executing what is a classical biotech hybrid model where we prove the technology by developing valuable products, engage in partnerships and then get acquired as our products move towards late-stage clinical trials,” she said.

When that time comes, it might not be completely the end of CytoSeek’s journey, Perriman noted. “The other opportunity for our technology is in regenerative therapies. It could well be that, as we have a platform technology, we carve these sections off. We have an amazing team and that is worth as much as the science.”

The technology also had applications in exosomes, Porter added, and there were underserved areas that the team might pursue in future under a different business model. For now, however, the eyes remained firmly on the price at hand and, following the spinout’s £3.6m ($5m) seed round last month, CytoSeek had an 18-month to two-year runway to prove its technology and build its preclinical pipeline.

An immediate goal following the round was to double CytoSeek’s headcount, Porter said. The team counted five full-time members of staff, with another two due to join in June, and Perriman on a half-time basis. The spinout also continued to rely on external consultants, Porter said.

The seed round’s size was impressive in a UK biotech context, but CytoSeek actually had offers for £4.5m on the table – having set out to raise only £3m. Porter noted that this gave the company the luxury of choice: “It was important to bring on board investors with the capability to follow, like Parkwalk Advisors. Science Creates Ventures (SCV) has ambitions to follow, but also Luminous Ventures. We were surprised by existing angel investors exercising pre-emption rights as well.

“Going forward, we will be looking for either corporate VCs or strategic investors to join our existing investor group. We have proof of principle, but we really want to build our preclinical package to excite those types of investors as part of the next round.”

Of CytoSeek’s current shareholders, Harry Destecroix is one of the most intriguing. In 2018, Destecroix sold his Bristol spinout Ziylo, which was working on next-generation insulin, to pharmaceutical firm Novo in a deal that, milestone payments included, exceeded $800m. In a more unusual move, Destecroix licensed back certain rights as part of the acquisition and launched Carbometrics, which is working on non-therapeutic applications such as continuous glucose monitoring products.

Destecroix also went on to become a champion for the Bristol ecosystem, first launching pre-seed incubator Unit DX with support from the university and, in December last year, expanding with seed to series A-stage incubator Unit DY and a £15m venture fund called Science Creates Ventures. Together, Unit DX, Unit DY and the fund run under the Science Creates brand.

At the time of Science Creates’ launch, Destecroix said: “Where a discovery is made has a huge bearing on whether it is successfully commercialised. While founding my own startup, Ziylo, I became aware of just how many discoveries failed to emerge from the lab in Bristol alone.

“No matter the quality of the research and discovery, the right ecosystem is fundamental if we are going to challenge the global 90% failure rate of science startups and create many more successful ventures.” 

CytoSeek became SCV’s inaugural investment but already, Porter said, Destecroix had personally invested in the spinout’s £1.19m pre-seed round in November 2019, when Parkwalk-managed University of Bristol Enterprise Fund, UKI2S and angel investors affiliated with Bristol Private Equity Club also injected capital.

Porter said: “Destecroix has phenomenal energy. When I was doing diligence on the role of CEO, I met him and his passion for the community and for CytoSeek was apparent. And he has obviously been through an exit, which brings a network and an understanding of what you need to do help prepare a business do that.”

Parkwalk installed investment director Cassie Doherty on the board of directors. Doherty had spent more than 11 years with Parkwalk’s parent firm, IP Group, specialising in life sciences before her move in June 2019.

Porter was keen to underline Destecroix was not the only notable figure that CytoSeek had managed to sign up. They also included Clive Stanway, the former chief scientific officer of Cancer Research Technologies, and Keith MacDonald, who has a banking background and is the chairman of Unit DX and was formerly chairman of Ziylo.

Porter added: “I should also mention Damian Marron, who joined our board as chairman just before the raise. He is a serial entrepreneur who has exited a number of cell therapy companies both through M&A and IPO transactions.”

Destecroix’s support however was critical not just for the expertise and capital, but also for that aforementioned Unit DX incubator. Porter noted that, when the pandemic began, CytoSeek had been based within the university and had intended to eventually move into Unit DY – due to open later this year.

Covid threw a spanner in the works. She recalled: “We faced either mothballing the company or finding alternative facilities because I felt it would be extremely difficult to raise capital if we had not got onward progress with the science.”

CytoSeek did have a small foothold in Unit DX, renting office space for admin purposes, and that connection proved a godsend. “One company was furloughing its staff and another was moving back into the university to help with the covid effort, and we sublet space from both of them. Other space came up that we took on permanently,” Porter noted.

Illustrating the absurdity of the early pandemic days, Perriman recollected: “We hired a big van and moved our equipment in one day. It was incredible teamwork, but you have got to do what you have got to do.”

It meant CytoSeek was able to continue working throughout lockdowns. The spinout rented more space than was needed to guarantee social distancing in the lab, and Perriman noted Unit DX quickly enacted safety measures. “There was impact, as everywhere else,” he said, “but we mitigated a lot of the stress.”

Plans to move to Unit DY remained in place, Porter said, and the spinout was staying in the Bristol ecosystem long-term. To a certain extent, the pandemic played into CytoSeek’s hand because of London-based researchers now looking for opportunities elsewhere, Perriman stated.

Porter expanded: “There is a nucleus of expertise growing in the cell and gene therapy sector in the southwest, centred around Bristol, which is great for us as a company. We are actively trying to develop those relationships.

“Bristol – not just because of the investment and the energy of people like Destecroix and the team at Science Creates, but also for us specifically in the cell and gene therapy sector – has a growing network and expertise that will keep us here and hopefully continue to enable us to attract people from London.”

Even with Perriman’s and Porter’s clear enthusiasm, CytoSeek would not have come to be without the initial grant funding it received from Innovate UK. The 4-Day MBA programme ended with a demo day, where Perriman met investors like Destecroix. But, Perriman remarked, “I did not want to take anyone’s money until I really knew what I was doing. The first Innovate UK grant, which was only £100,000, really was a point where we could spend some money and I wrote another handful of successful small grants to build the company up slowly.”

The grant, he stated, “forces you to get started, which is important, and to put in place some structure. We had an amazing monitoring officer – I got more out of the him than he got out of me.

“We ran the company without a CEO for the first year and a half. That was intentional – I could have named myself CEO, but we really wanted to hold that position open.”

Innovate UK then also took part in the pre-seed and seed rounds through UKI2S, managed by Midven – since acquired by long-time GUV partner Future Planet Capital.

Perriman cautioned: “You have to be careful with grants though, you can get trapped by their work programmes because it is milestone driven. You need to make sure that relationship is well established with your monitoring officer – if you are open and honest with them and you do need to pivot, they are generally pretty good. But if you are not careful it can be extremely laborious.

“Once the company is moving along, most grants – unless you are writing for over £500,000 or close to £1m – are almost not worth writing unless it is strategic.”

It was a good programme, Perriman and Porter agreed and it ought to have a bigger budget. The Bioindustry Association continued to lobby the government both for more non-dilutive and equity funding, Porter said. “For companies like us, outside the golden triangle, it is really important,” she added.

It is very easy to forget, when talking to Perriman and Porter, that this is the first time for both leading a company as chief scientific officer and chief executive, respectively. Porter began her career as an academic, before moving into business development and corporate finance at companies like Novartis and Ernst & Young. She then joined Oxford University Innovation, where she spun out companies like Evox (also see this issue for an interview with its CEO Antonin de Fougerolles) and Vaccitech, which developed the technology underlying the Oxford/AstraZeneca covid vaccine.

“What attracted me to tech transfer and why I ended up here was that I had big company experience, but I was really interested in early-stage companies,” Porter revealed. “When working in Novartis, we licensed in early-stage technologies and I was at that interface. I thought it would be cool to work in the spinout community and like many people who join tech transfer organisations it was my goal to get that experience of starting new companies and then jump into one, which is what I did eventually.

“The reason I chose CytoSeek is Perriman. He was a phemonemal salesperson and I felt we could have a lot of fun. At the end of the day, and one of our investors said this, if you do not have a team that works together effectively you can have a really good technology not go anywhere.”

She continued: “We have a great working relationship and we balance each other. That is true for the rest of the team as well, like our chief operating officer Ben Carter, who was one of Perriman’s PhD students. Perriman and Carter had already pushed the business significantly forward before I came on board.”

Porter was also interested in the Bristol ecosystem, she remarked: “I was ready for something outside the golden triangle. In addition to working on CytoSeek, I have been talking to other companies in the ecosystem and trying to set up a cell and gene therapy network.”

Would Perriman do it all again? Yes, he replied, after all CytoSeek’s creation was an intentional career move. “It is extremely exciting. I have that personality type; I am not the introverted professor in his lab and I am also practical.

“I am also really fortunate to be a UKRI Future Leaders fellow and in fact I have been on fellowships all the way through professorship, so almost all of my time is focused on research and development with little admin and a few lectures throughout the year. That is extremely important because otherwise something would have to give.

“Looking at clinical translation – taking a concept all the way through to, hopefully, a treatment – is really rewarding. At the same time, I also like the raw creativity within a university research group. You can pursue the really mad ideas and the things that pop out from that are really innovative and almost certainly have legs for commercialisation.”

Of course, the focus remained on CytoSeek for now but, he added: “I am certainly not jaded from the process and I could definitely work with Porter again.”

The bigger question, he pondered, was balancing the company workload with his academic position. “Sometimes I am asked by investors if I would be willing to walk away from my job. But universities are really dynamic places and help with idea generation, so I do not see a way where I would have to walk away from that. But you never know.”

It was not a decision he would face anytime soon anyway, Perriman concluded: “We are really excited about the developing the next generation of cell therapies for oncology and solving the solid tumour problem.”

Both Porter’s and Perriman’s passion for and pride of CytoSeek, its team and the Bristol ecosystem clearly shines through and with the resources in place to now build its preclinical pipeline, there is little doubt CytoSeek will have a great impact. It is hardly surprising that seed round was oversubscribed.