Hadasit Leads $1 Million Financing Round for Cancer-fighter TK-Signal

Startup is developing radioactive molecules to identify, treat tumors

Hadasit Bio-Holdings has led a million-dollar investment in TK-Signal, a startup developing radioactively-labeled compounds for cancer diagnosis, monitoring, and therapies.

Half a million dollars came from Hadasit itself. The Ofer Hi-tech and Proseed venture capital funds put up the rest.

The investment valued TK-Signal at $5 million post-money. The company's chief executive, Dana Cohen, commented that TK-Signal should be holding another fundraising round in a matter of months.

So far Hadasit has invested no less than NIS 8.5 million in TK-Signal in exchange for 40% of its shares.

The startup company develops radioactively labeled molecules (probes) that specifically target certain tumors for purposes of diagnosis and possible treatment.

The technology is based on discoveries made by Prof. Alexander Levitzki, from the the Hebrew University of Jerusalem, and Dr Eyal Mishani, an expert in radiochemistry and nuclear medicine. Mishani is the head of the cyclotron unit at the Hadassah Hebrew University Hospital in Ein Karem, Jerusalem.

The probes were designed to identify and target both mutated and normal forms of epidermal growth factor receptor (EGFR). This receptor is involved in the proliferation and differentiation of normal cells, and it naturally occurs in various cells of epithelial origin, such as the skin, CEO Dana Cohen explained to TheMarker.

But the gene for EGFR is often expressed atypically in cancerous cells. EGFR was found to be over-expressed in about 70% of human epithelial tumors. The scientists' idea was to exploit this distinctive overexpression of this target receptor to diagnose certain cancers and possibly to develop therapies as well.

The ability to detect specific types of tumors is based on an imaging technique called Positron Emission Tomography (PET).

A radioactively labeled bioprobe is administered to a patient. It becomes distributed throughout the body and accumulates in target tissues and organs.

The localized radioactive tracer is then visualized by PET cameras. Following administration of a radioactive probe that attaches to EFGRs, cancer cells - which overexpress this receptor - would be expected to accumulate the tracer and glow. Normal tissue ? not cancerous ? has relatively little EGFR and barely glows at all.

Hadasit manager Raphael Hofstein commented that TK-Signal would be using the proceeds to conduct clinical trials on its product as a diagnostic tool, while pursuing the development of therapies for cancer.

The company's goal is to reach the world market with radioactive imaging products that diagnose cancers. It is especially targeting the market for biological markers used by nuclear imaging techniques, Hofstein said.

Frost & Sullivan has estimated the world radio-pharmaceuticals market at $2 billion, and projects 10% annual growth through the coming five years.

PET technology is used to identify cancers of the lung, breast, and intestinal tract, as well as lymphomas and melanomas.

Hadasit Bio-Holdings was established by Hadasit, the intellectual property commercialization corporation of the Hadassah Hospital in Jerusalem. HBH has invested in nine startups, including TK-Signal. Most of them have already passed the scientific feasibility stage, meaning their products work in animal models, but have not yet been tried on humans. All the startups believe their products have the potential to be blockbusters, selling for billions a year.

The company Hadasit went public on the Tel Aviv Stock Exchange at the start of January 2006 and has already produced 5% returns for investors. It is the only one of the seven biotechnology companies that went public in the last third of 2005.