Venture capital flowing into Maryland -- Gazette.Net


More venture capital and other funds are flowing into companies in Montgomery and Frederick counties these days, according to new reports.

Chevy Chase-based Precision for Medicine, which provides specialized services and infrastructure for biotechnology companies, recently secured $150 million in private equity financing to support acquisitions and development.

That amount tied for the highest in the nation taken in by one company in the second quarter, with a similar figure received by New York e-commerce business, according to the MoneyTree Report.

Precision for Medicine, which formed last year and has offices in Gaithersburg, Frederick and Cambridge, Mass., is the most recent venture launched by entrepreneurs Ethan D. Leder and Mark P. Clein. The pair formed a similar business in Bethesda, United BioSource Corp., which once employed about 1,600 researchers before being sold to Medco Health Solutions in 2010 for about $730 million.

“This financing will allow us to aggressively acquire and grow a unique portfolio of capabilities designed to deliver lower development costs, speed the time to market and improve success rates,” said Clein, Precision for Medicine president. The company has about 130 employees.

Germantown-based Intrexon Corp., a biotechnology company focused on the industrial engineering of synthetic biology, received $85.6 million in venture capital last quarter, the fourth largest deal in the nation. In the first quarter, Intrexon received $64.4 million as part of a $150 million investment round.

The funds are being used to develop products and expand departments such as sales and marketing, and research and development. The company is in a “quiet period” due to recently filing forms to go public and could not provide further details, said Marie Rossi, a spokeswoman.

Those two deals accounted for about three-quarters of the $318.4 million in venture capital received by Maryland businesses last quarter, according to the MoneyTree Report. The study is released by PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thomson Reuters. Maryland’s total last quarter was more than twice what it was in the first quarter and six times more than in the 2012 second quarter.

While the growth is encouraging, the question is whether that trend can continue, Mark Heesen, president of the association, said in a statement. “There will be no tech bubble,” he said. “[Information technology] investing will continue to be the bedrock of the venture industry — but at sustainable levels. Life sciences investment is poised for a slow and steady recovery, provided we can continue to see progress on the regulatory front.”

On Monday, officials with the Maryland Technology Development Corp. said that agency had disbursed $1.1 million to 14 companies through its technology transfer and commercialization fund since last September. The fund helps young businesses bring inventions to market.

Getting $75,000 each were Bethesda-based Brain Sentry, which developed a helmet-mounted sensor to detect concussion-causing blows; Gaithersburg-based ConverGene, a biotech focusing on cancer therapies; Frederick information technology company TimberRock Energy Solutions; and Gaithersburg female fertility company Pregmama.

Bethesda-based Weinberg Medical Physics, which makes imaging systems to detect breast cancer and guide the surgery process, received $60,000.