RTP’s Locus Biosciences closes $35M Series B, investors include J&J and Tencent

RESEARCH TRIANGLE PARK – Locus Biosciences, Inc. announced today the firm has closed a $35 million Series B fundraising round that includes new equity financing and the conversion of a convertible note.

The company disclosed some of the round in a filing with the SEC earlier this year.

The RTP-based clinical-stage biotechnology firm said in a statement that investors included Tencent Holdings, Viking Global Investors, Artis Ventures, and Johnson and Johnson Innovation.

Locus Biosciences already maintains a collaboration with Janssen Pharmaceuticals (Johnston & Johnson), covered in prior WRAL TechWire reports. In total, the company’s partnerships are worth more than $1 billion, it disclosed in a statement. The J&J partnership is worth up to $818 million alone and included $20 million in up front payments.

“Locus’ novel scientific approach has the potential to fundamentally change the way bacterial diseases are treated,” said Paul Garofolo, Co-founder and CEO of Locus Biosciences in a statement. “This financing helps Locus accelerate our growth, while remaining nimble and adaptable.

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According to a statement, the company will use the new capital to support the advancement of the firm’s lead drug candidate.

The candidate, LBP-EC01, is called by the company a “precision medicine,” targets the bacteria that causes urinary tract infection. The company aims to initiate a phase 2 clinical trial for the therapy later this year. In 2021, the company completed a Phase 1b trial for PBP-EC01.

Locus technology focuses on the use of a bacteriophage discovery, synthetic biology and manufacturing platform. It develops precision CRISPR-enhanced bacteriophage products, according to a statement.

The company entered into a $25 million credit facility with Hercules Capital in 2021. The company also landed a $144 million partnership with Biomedical Advanced Research and Development Authority, BARDA, in 2020, and a $12.5 million arrangement with CARB-X.

Garofolo previously told WRAL TechWire the initial funding for the company came from him and his wife, and went on to raise a seed round of $1.5 million in 2016, a $19 million Series A round in 2017. The investor funding continued in 2020 with $20 million in a convertible note.

But the company got its start as a spinout of research conducted at North Carolina State University. The company was supported in its early development by the North Carolina Biotechnology Center, with $325,000 in loan funding.

The North Carolina Biotechnology Center also confirmed to WRAL TechWire that three of the company’s four scientific founders received grants from the organization, which together total more than $300,000. Locus CFO Joe Nixon is a former employee of the North Carolina Biotechnology Center, who led emerging company development for the entity until joining Locus in 2017.

Garofolo told WRAL TechWire in December 2021 that there’s a “revolution occurring in medicine.”