The Johns Hopkins University researchers behind two of Baltimore's most successful biotech firms have founded a new company that has now raised $56 million to create a new diagnostic tool for cancer.
Haystack Oncology plans to use the funding from its series A round to kickstart a move into a large lab inside of City Garage in Port Covington, which was recently renamed Baltimore Peninsula. The company also plans to invest in more clinical trials to get additional data to support the effectiveness of Haystack's cancer detection blood test. The 50-person company, currently based at Hopkins' FastForwardU, plans to have a commercial launch in 2023.
The round closed in October and was led by Catalio Capital Management, with participation from Bruker, Exact Ventures, the venture arm of Exact Sciences, and Alexandria Venture Investments. Haystack also received funding from an undisclosed seed round in 2021.
The company was founded in 2021 by a team of several Hopkins researchers, including Thrive Earlier Detection Corp. co-founders Bert Vogelstein, Ken Kinzler and Nick Papadopoulos. Thrive is one of the more notable biotech success stories in Baltimore, having been acquired by Exact Sciences for over $2 billion in 2020. The three are also co-founders of Baltimore-based Personal Genome Diagnostics (PGDx), which was acquired by Lab Corp. in a deal worth up to $575 million that closed earlier this year.
Catalio Capital Management, which raised a massive $381 million fund earlier this year, also has ties to the Hopkins researchers and to Baltimore. Vogelstein's son Jacob is a co-founder of Catalio and Bert is a venture partner at the firm. Catalio spun out of Baltimore-based Camden Partners and is now based in New York but still retains an office in Harbor Point.
Haystack CEO Dan Edelstein said the company's test looks for a byproduct of tumors, called circulating tumor DNA, after a patient has received initial treatment for cancer, such as surgery. Patients with relatively early stage forms of cancer can often be treated through surgery alone without the need for additional treatments. However, follow-up diagnostic tools such as MRIs can often miss small tumors.
“The tools today don't necessarily provide the resolution into their disease status," said Edelstein, who previously served as chief operating officer of Sysmex Inostics, another Baltimore company specialized in circulating tumor DNA detection. “That's where we think with the Haystacks approach, we can create the biggest clinical impact and benefit for patients.”
If the company detects cancerous DNA, that is an early indication that tumors may still be present in the body and the patient needs more treatment. Haystack is working with the Food and Drug Administration and will offer its technology as a laboratory-developed test — a method that requires less FDA oversight and enables a broad range of usage compared to some other types of medical device approvals — before moving toward increased FDA validation.
In June, some of the first pieces of peer reviewed research showcasing how technology similar to Haystack Oncology's can be used as a biomarker, were published in the New England Journal of Medicine, Edelstein said. The use of the biomarker reduced the number of patients who needed follow-up treatment by confirming that they did not exhibit any markers of ongoing tumors.
“You're adding more precision to the application of therapy by more carefully selecting patients with a higher-risk profile,” Edelstein said.
