ALBUQUERQUE, N.M. — NanoMR Inc., a homegrown Albuquerque startup that specializes in magnetic resonance imaging for infectious disease, is being moved to California by the London company that acquired it earlier this year.
The parent firm, London-based DNAe, said it will continue product development and launch manufacturing operations in San Diego for commercial sales of its forthcoming technology — a rapid diagnostic for bloodstream infections. Most of the company’s local workforce of about 29 people have agreed to move to San Diego, according to the company. DNAe expects to expand the workforce to more than 50 people.
DNAe acquired nanoMR in a $24 million merger last January.
NanoMR, now called DNA Electronics Inc., said the company needs to be closer to the skilled pool of scientists and engineers available in the San Diego area, as well development partners, suppliers and clinical diagnostic expertise there. The company said it will build a specialized clinical diagnostic manufacturing facility, clinical testing laboratories and a commercial team in California.
“Albuquerque has been a fantastic place to build our innovation-led business and develop our technology over the last decade,” said DNA Electronics CEO Victor Esch in a prepared statement. “As we transition into our next stage of development, building our operations toward the launch of our pioneering test for serious blood infections, San Diego offers us the opportunity to expand our workforce and exploit opportunities within the San Diego life sciences hub.”
NanoMR, currently located at a 19,000-square-foot facility near Jefferson and I-25, formed in 2007 to develop technology originally licensed from the University of New Mexico, Sandia National Laboratories and Albuquerque firm ABQMR Inc. The technology allows technicians to detect and diagnose blood infections in just two hours. That compares with 24 to 27 hours that doctors must wait today for labs to grow cultures.
Before being acquired by DNAe, nanoMR had raised about $21 million in venture capital. That included assistance from Albuquerque-based Puente Partners LLC, plus early-stage investment by Santa Fe-based Sun Mountain Capital, which manages the New Mexico State Investment Council’s private equity program.
Most of the company’s later-stage investment came from out-of-state.
NanoMR also received about $70,000 in state money between 2012 and 2013 for training four of its employees through New Mexico’s Job Training Incentive Program. Clawback provisions on those incentives only last one year, according to the state Economic Development Department.
Waneta Tuttle, a serial entrepreneur who originally helped launch nanoMR through Puente Partners, said the company’s departure reflects, in part, the lack of more locally-based venture investment.
“Most later-stage investment comes from out of state, and there’s not necessarily enough incentive at that point for those investors to stick around,” Tuttle said.
That’s especially true when a firm is acquired by an international company like DNAe. And the problem is compounded if a startup like nanoMR is acquired before it’s actually selling product.
“I don’t know nanoMR, but that’s always a risk,” said Tom Stephenson, managing partner with the Verge Fund in Albuquerque. “If an acquirer buys a company with established product, sales, marketing and infrastructure, the buyer is then much less inclined to pick it up and move it.”
Lisa Kuuttila, president of UNM’s Science and Technology Corp., said she’s sorry to see nanoMR leave Albuquerque.
“They started the company here with the help of a lot of local investors and entrepreneurs, but sometimes companies end up moving if the firm or investors that acquired it make that decision,” Kuuttila said. “Still, for us, the most important thing is that our technology is in the market and benefitting the public.”
UNM and its partners will also eventually earn royalties from DNA Electronics’ sales.