Chronix Biomedical is a privately-owned biotechnology company specialising in liquid biopsies for monitoring the effectiveness of cancer drugs, including immunotherapies, in real time. It also has a marketed product for detecting organ rejection, in as little as hours, following transplant. The primary benefit of these products, marketed under the TheraSure brand, is in improving patient outcomes by assisting clinical decision making. A favourable pricing model, aided by Chronix’s asset-light structure, provides an excellent commercial profile. Chronix is seeking a funding round of $10-30m to support further commercialisation.

  • Strategy: Chronix operates primarily in the transplant and cancer therapy monitoring markets. The TheraSure brand was recently launched in Europe. With little direct competition, it is harnessing its first-mover advantage initially in Europe, then in the US, by out-licensing its tests to accredited laboratories.
  • Improving outcomes: TheraSure offers significant health economic advantages through improving patient outcomes and via its reasonable pricing model. The technology provides early evidence of immunotherapy or transplant failure, informing real-time clinical decision making, and a reduced burden on payers.
  • Valuation: The latest funding round in 2017-18 was at a depressed price of $0.1 per share, giving Chronix a post-money valuation of $16.5m – contrasting with the $44.6m invested in the company to date. Chronix has recently signed an exclusive 15-year commercial deal, which has an NPV worth a minimum of $92m.
  • Risks: Investments in private, early-stage companies carry a significant risk and investors must be aware of this fact. Patent robustness, the regulatory and reimbursement environment in the US, and competition in a crowded market are all factors that could impede Chronix’s progress.
  • Investment summary: Chronix is looking to raise $10-30m in a pre-IPO funding round to take it through the early stages of commercialisation with Amedes, to undertake clinical trials to enhance its regulatory programmes, and to maintain/strengthen its patent position. There is a large and growing demand for accurate cancer therapy monitoring, for which Chronix has the IP.