Over £200m invested in Babraham Campus companies in last year – but what lies ahead?


The Babraham Investor Conference 2021 (BIC), an event for investors focusing on early-stage and scale-up life science and med-tech companies, moved online for the first time in its 15-year history, writes Sarah Brereton.

The virtual conference saw a day’s worth of content condensed into two hours including start-up and scale-up company presentations, keynotes from Daniel Mahony of Polar Capital and Martin Murphy of Syncona, as well as many interactive Q&A opportunities.  

Derek Jones, chief executive of the Babraham Research Campus opened the event by outlining how the Campus directly impacts the investor community: “Research has shown that investors see a 7.2 x return on investments on average in Campus companies. 

“And as for Campus companies themselves, they tend to raise money five months earlier and raise 10 per cent more money than they otherwise would have done if they weren’t on the Campus.”

There has been significant investment – in excess of £200 million – in Campus companies over the past year. PhoreMost closed a £33m Series B financing, Alchemab Therapeutics raised £60 million in Series A financing, and in the last few weeks, Transine Therapeutics raised £9.1 million in seed funding. 

The Campus has also seen some billion-dollar deals with Kymab announcing its acquisition by Sanofi for £1.5bn and Artios Pharma closing a deal with Novartis potentially worth at least $1.5bn.

Public markets and the suspension of disbelief 

Daniel Mahony, co-head of healthcare, Polar Capital was first in the hotseat and presented the key issues of concern for investors in the biotech sector. The first issue is the expectation that money will continue to flow into the sector. Last year was the best financing year ever with $75 billion of new equity flowing into the global biotech sector.

“The feast of capital is unlikely to go on forever,” said Daniel. “A big driver in the increase of risk capital has been a steady decline in interest rates which can drive valuations much higher. 

“The fly in the ointment is inflation and we are starting to see inflationary pressure in the economy. Long term interest rates won’t get much lower and if they do begin to increase it could stem the flow of capital into riskier sectors such as biotech.” 

Multiple players mean a fight for market share

Daniel also highlighted competition as a key risk factor: “Many of the indications being targeted by biotech companies look set to be highly competitive, creating issues over patient recruitment, access to key opinion leaders, and share of voice in the end market. 

“Competition in the market for the investor, especially at the early stage of drug development, can mean uncertainty and this doesn’t seem to be factored into the valuation of many early-stage companies.” 

How to prepare if perceived reality begins to bite

Daniel added that they are still very optimistic about what is going on in life sciences: “The pace of innovation is amazing, and the opportunities for companies in the sector to have a meaningful impact on human health is tremendous. In the UK, we sometimes look with envy at what’s going on in the US, but we do have some advantages when it comes to addressing these underlying assumptions.”

He offered four specific pieces of advice:-

  • On capital efficiency: “In general UK companies have been capital efficient, but it’s easy to waste money in R & D. Too much capital can be as bad as too little.”
  • On drug pricing: “In the UK we are acutely aware of drug pricing due to organisations such as NICE which gives us a head start. The important thing to consider is that cost effectiveness is not the same as affordability. It’s the latter that will be more of a political issue going forward.”
  • On raising capital: “Be opportunist but accept that financing windows do close.” 
  • On competition: “This is something we all need to focus on. Defining the therapeutic profile and target patient population very early on in the process will be increasingly important.”

Scale-ups at the Babraham Research Campus

After three short and snappy presentations from NRG Therapeutics, TRx Biosciences and Maxion Therapeutics on their ground breaking work, covering therapeutics for neurodegenerative diseases, disruptive drug delivery and formulation, and antibody development for ion -channels respectively, the pace continued with presentations from two scale-up companies based on Campus. 

Dr Jane Osbourn from Alchemab Therapeutics, an 18-month-old antibody therapeutic discovery and development company, shared her focus: “The difference from the classic paradigm of drug discovery is that we’re trying to understand why people stay well. 

“We focus on extremely resilient people who should be ill but aren’t, for example people who have mutations that predisposed them to conditions such as early onset Alzheimer’s and Huntington’s disease but don’t develop those conditions. We do very deep sequencing of their antibody repertoires and look for antibodies that are shared in these individuals.” 

The company, which has been described as “turning the conventional biotech model upside down” has already signed a collaboration with AstraZeneca and completed a £60 million Series A financing round.  

Florian Schuster, co-founder of, dedicated to producing and democratising access to stem cell derived functional human cells for research, drug discovery, and cell therapy, was the second scale-up speaker. 

Florian revealed how the company is coding human cells to precision engineer the next generation of medicine: “We are solving the manufacturing problem of human cells which allows us to overcome the major problems our sector is currently facing: the reproducibility issues in scientific research, the translational gap in drug development, and to make cell therapies consistent and scalable.” 

The company now has 100 employees and has raised more than £50 million in seed and Series A funding. 

Both Jane and Florian agreed that the main issues on their rapid scale-up journey are good decision making, physical space to scale, strong recruitment, and capital efficiency with Florian borrowing from Dave Packard of Hewlett Packard to comment on the latter issue that: “most scale-ups die of indigestion, not starvation.”

Babraham bootcamp: Accelerate@Babraham 

Derek then introduced the “Babraham bootcamp” – or Accelerate@Babraham as it’s more commonly known. The 2021 competition is now open for applications and Derek encouraged those with big ideas to apply by highlighting some of the successful companies that had already been through the programme. He said: “It will change your life.” 

The 2020/21 cohort, which included ArkVax, ConcR, Paediatric HealthTech, and Stroma Biosciences, were given fast and furious five-minute slots to present to the virtual audience of investors. They gave progress updates, an insight into the science behind their start-ups and imparted real examples of how Accelerate@Babraham had given them the support, facilities and finance they needed to take the next steps. 

Paediatric HealthTech founder Dr Tamsin Holland Brown, who has developed a solution to help children with glue ear to hear, reported that her product has been essential in supporting children with glue ear during COVID. 

Increased waiting times, the introduction of masks and home learning led to increased challenges for children with hearing loss and ‘HearGlueEar’ was one of the only ‘remote’ solutions during COVID which has led to a lot of interest and enquiries from hospitals.

Dr Eugene Park, co-founder of Stroma Biosciences shared how the programme has been “a safe space” in which to develop its overarching mission, and how “generous mentors enabled us to focus our efforts”. 

Looking to the future, Stroma’s focus is on data to support the rationale of conducting clinical trials.

ArkVax co-founder Jon Cuccui echoed the ‘risk-free’ element of the programme, being able to pitch to angel investors and VCs: “We had the benefit of real practice and received crucial feedback from investors and the Babraham Research Campus companies. Our next step is to secure commercial contracts, raise investment and grow our team.”

ConcR disclosed its commercialisation strategy and outlined how Accelerate@Babraham had helped to refine value proposition and target market through deep conversations with pharma companies: “The programme helped us to complete a pre-seed funding round which allowed us to execute a project with Roche and Durham University and the NHS which will be a key part in proving our technology. As a result of that we have been able to employ another six people,” said Matthew Griffiths, ConcR co-founder and CTO. 

In terms of next steps, the company is closing a split seed round this month and looking for more investors in October. 

Conversational joust between two giants of the life science cluster 

In a break from the presentational format, the final part of the conference saw a fascinating conversation between Martin Murphy, CEO of Syncona – an investment management company which boasts the Wellcome Trust as its largest investor – and Andy Richards, a serial angel investor and entrepreneur who has invested in and scaled 25 ventures and is well-known within the Cambridge Cluster for his support and encouragement for early-stage and established companies in the sector. 

Topics ranged from venture fund models and a fundamental shortage of capital in the UK, to the importance of company culture and talent retention. 

An improvement in UK pace

Addressing pace in the sector, Martin says the UK has picked it up: “Pace matters. In the UK, historically we haven’t run as fast as others, but we have absolutely improved. 

“Yet, the whole world has accelerated too, particularly the US and China in our sector which is a powerhouse in development.”

He says the UK has all of the right ingredients but we still have a shortage of capital and that’s what we need to keep us competitive: “Cost of capital is going up in our asset class and the flow of capital is reducing to our asset class – there’s a swing from fundable stories with absent data to a product and data-focussed world.”

Be internationalist to access capital

So, how do we bring in capital? Martin says: “The shortage of capital keeps me awake at night. It’s about being very front foot around fundraising – you have to have the ambition level and you’ve got to be persistent and resilient. Fundraising is often an experience that is fundamentally a ‘no’! 

“Global investors are interested in backing global businesses, not the provincial. But we’ve seen more foreign investment into the UK and I’d push us to be internationalist and aggressive in accessing that capital.”
Found, build and fund

Andy was interested in the Syncona way – found, build and fund – and asked whether anything had changed in that approach. “Two things – financing and people,” said Martin.

“Generally, when we start a business with a founding academic, we like to be on our own. Start-up is a battle of kinetic energy against inertia, and you’ve just got to keep running at it. 

“If you can take away one degree of freedom or chaos, which is syndication, that’s valuable. You can be recklessly conservative or recklessly ambitious but you have to find the right line. 

“It’s about smart decision making, capital allocation and discipline. But there’s no fixed playbook and increasingly we want to bring investors in earlier. Timing can be everything.

“We’ve also learnt about the importance of people. We are very good at assessing technology, getting the investment done, but then looking around and asking where are the people?! These aren’t technology businesses; they are people businesses.”

Yes, no, maybe

To end the event, Martin answered some quick-fire questions from Andy on his thoughts on the next big investment opportunities:

AI in drug discovery? Yes, but narrower than it is being purported to be.

Longevity? No. Gene editing as a therapy? Yes. 

Digital therapeutics? Yes, but the business model needs to be refined for a small company. I’m a huge believer in digital therapeutics and data plays on healthcare, that’s one of the big forefronts. The business model for small companies is unclear. 

The question is, who’s the natural owner for those business? Microsoft, Google Amazon? Or is it a start-up? I haven’t figured that out. Psychedelics? Yes.

Neuroinflammation? Absolutely yes.

Liquid biopsy? Screaming yes! In three to ten years’ time, I think you will be getting an annual blood draw in the same way as you get your blood lipids measured to give you your oncology risk and you’ll be directed to imaging with a statistical risk for where the imagers should look first. Very positive.

MRNA? Oversold in my view. I think Moderna and BioNTtech discovered the killer application bar none – which is rapid vaccine responses in a pandemic setting where you have to move super fast; 62 days from sequencing to product. The question is what is the application outside of that? 

For example, in the cancer vaccines field where those therapies are being pursued, I will be much more sceptical than the market there. Overwhelming yes in a vaccine fast response setting. But in a cancer vaccine setting, lukewarm – maybe, but show me the data.

Antibacterials? Heartbreakingly no, it’s a market failure.

Antivirals? Yes.

Antifungals? Yes.

Bioelectronics? Maybe. Narrow. The data in the auto-immune setting I think is remarkable. I was extremely sceptical but you can’t argue with the data in the auto-immune setting. The question is breadth of application, specificity and what is the product? Is it a neuro stimulator? Who’s the natural owner of that?

Does anything change in Alzheimer’s and Dementia now? I really think it does post Aducanumab. An approval on a biomarker end point is a remarkable outcome. It shows a pathway to approval for agents on biomarker support in CNS disease. 

• BIC is supported by sponsors, Handelsbanken and Taylor Vinters. If investors would like an introduction to any of the companies featured at BIC 2021, email: