Photo: Courtesy/Starton Therapeutics
Business

Mexican entrepreneur seeks 2,500 investors for startup against cancer

$20 million is needed to continue his company, which is developing a technology to prolong and improve the lives of cancer patients

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“You already have the no, go ahead and seek the yes”, says an old Mexican saying that applies well to entrepreneurs who need to raise capital. But to get the yes you need more than mere desire.

This is the experience of Mexican Pedro Lichtinger, CEO of Starton Therapeutics, which in four years has raised $27 million from 250 investors. “It was with blood, sweat, and tears, hundreds of presentations with small banks, gathering groups to attract people who have money, family funds,” says the entrepreneur.

Pedro Lichtinger, CEO of Starton Therapeutics. Photo: Courtesy

But it’s still not enough. The startup now needs to raise another $20 million to move on to the next stage of growth, decisive to prove the viability of the business and go public within 10 months. The strategy does not contemplate investment from capital funds or contracting debt, only the direct participation of some 2,500 investors.

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Lichtinger started his biotech startup in 2017, largely to help his brother, diagnosed with cancer and metastasis seven years ago, and millions of patients like him. His greatest strengths are a passion for developing health technology, 35 years of experience in the pharmaceutical industry – most of it as a senior executive at Pfizer – and a team of renowned scientists.

Starton Therapeutics pledges to improve the quality of life and longevity of cancer patients through a transdermal technology – a patch – that acts as a vehicle to deliver proven effective drugs to cancer patients. This form of administration is capable of amplifying the potency and reducing the side effects of the drugs.

The startup has five programs in the experimental phase with different drugs, and one of them has already been successful in the animal phase. It is Revlimid, a drug used by people with a certain type of blood cancer.

“The animals that did not receive the drug died after 28 days; the animals that received Revlimid (administered in the traditional way), died after 52 days; the animals that received our treatment were still alive after 100 days, and 20% of them free of cancer,” says the entrepreneur.

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The use of the patch allows an extended-release and reduces the use of the drug by up to 70%, which reduces side effects. “Revlimid is administered every 24 hours, but after 14 hours you no longer have the drug in the body and the cancer cells have room to develop resistance. With a patch that you wear on your shoulder for seven days, the drug is released all the time.”

The U.S. FDA (Food and Drug Administration) has already approved the project for human trials, which could begin in mid-2022. After four months it would be possible to know whether the system works or not.

“The moments of value inflection are the moments of scientific success when data appears that proves the hypotheses that are being tested,” says Pedro Lichtinger.

More than a reality show

After these victories, Lichtinger put into practice the strategy to obtain the other portion of the funding. To do so, he participated in a reality show, Unicorn Hunters, where a panel of investors bet on companies that intend to become “unicorns”, that is, to have a valuation of more than US$ 1 billion. The program also works as a showcase to attract the attention of other investors.

When presenting the project, Lichtinger explained that with the initial public offering they will be able to raise $50 million and reach the value of $700 million. The statement surprised one of the investors, who asked how the startup would become a unicorn.

After phase 2, that is, the human testing phase, replied Lichtinger. If it turns out to be successful, the multiplication of the investment will be exponential. “When we get to humans (if it is effective) we will have a volume increase, and in nine to 18 months you will see your money double. If you are patient, up to 100 percent,” he replied.

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The potential of the business is huge. Sales from the development of Revlimid alone could generate $3 billion in revenue in the first year. According to the World Health Organization, by 2020 there were 19.3 million people with cancer in the world.

Lichtinger’s arguments succeeded in convincing three of the seven-panel members to invest. “Our dream is to make cancer just a chronic disease, like AIDS. Today patients have up to eight years of life expectancy, and quality of life is compromised by both cancer and drugs. That’s what we want to change,” says the Mexican entrepreneur.

(Translated by Isabela Fleischmann)