May 2010

Oishei Makes First Bio-medical Investment (from Business First: May 17, 2010)

A $200,000 investment in a Buffalo biomedical firm represents the first equity investment by the John R. Oishei Foundation. But the investment in AndroBioSys Inc. won’t likely be the last such investment by Oishei as the private foundation continues to explore additional mission-related investment opportunities in the region.

Oishei has been looking at different ways to meet its mission through both loans and investments that utilize the 95 percent of its assets that aren’t given away as grants. As of the end of March, those assets totaled nearly $270 million.

The investment in AndroBioSys was reviewed by the foundation’s investment committee with assistance from an outside consultant to ensure the investment maximizes opportunity for the foundation while minimizing risk. It also must enhance community health and medical research to meet its mission.

“If in fact it is successful, not only will there be financial reward to the foundation, but it will also have significant benefit on the community and hopefully enhance not only the health but medical research part of our community,” says Robert Gioia, foundation president.

Continue drug development

For AndroBioSys, the investment allows the company to continue its drug development process for prostate cancer, as well as marketing its screening tool that uses human cells and tissues in the early stages of drug evaluation.

Michael Zwick, CEO, says bringing on Oishei as a funding partner opens up new opportunities for the firm, formed as a spin-off from
Roswell Park Cancer Institute in 2007.

“We’re completely in line with the type of research they’ve been supporting through UB and Roswell,” Zwick says. “The challenge we face is that companies like us, there are not a lot of ways to support us through state and local resources.”

AndroBioSys is currently waiting to hear back on several Phase Two federal research grants through the Small Business Innovative Research program, which follow successful Phase One grants last year from the Department of Defense and National Cancer Institute.

Earlier this year, the company also qualified for new Phase One grants of $138,000 through NCI’s Innovative Molecular Analysis Technologies program; and for $126,000 from the National Institute of Diabetes and Digestive and Kidney Diseases, part of the National Institutes of Health.

Fifth investment source

The Oishei investment represents the fifth different funding source over the past 18 months. Zwick says the firm is now preparing Phase Two grant applications for each of the federal sources, each of which could range from $250,000 to $2 million in additional funds. The Oishei investment could also be followed by a second round, he says.

All of that funding is helping the company validate its contract research program and move closer to commercialization of those products, Zwick says.

The outcome of those Phase Two grant applications could be significant: Zwick says if they are all funded, he could be hiring 30 to 40 researchers and support staff by year-end. He’s also considering moving the company from the UB Center of Excellence in Bioinformatics and Life Sciences to the new Innovation Center nearby on the Buffalo Niagara Medical Campus.

That’s exactly the type of growth Oishei is hoping for as it continues to explore investments at companies like AndroBioSys, Gioia says. “One of the outcomes we’re looking for is to make sure an investment is made in a locally based biomedical firm and if it can be successfully commercialized into a viable business,” Gioia says.