MD Anderson, Accelerator bake up Magnolia, an NYC biotech in neuroprotection, with $31M series A

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NYC-based Magnolia's $31 million coming-out round was backed by the VC arms of AbbVie, Eli Lilly, Johnson & Johnson, WuXi AppTec and Pfizer, which cut its own neuroscience R&D programs in favor of venture funding efforts. (Daniel Kloe/iStock/Getty Images Plus)

MD Anderson Cancer Center and Accelerator Life Science Partners have co-founded a new company, Magnolia Neurosciences, to develop a new class of targeted neuroprotective drugs discovered by the cancer center’s researchers.

New York City-based Magnolia hopes to halt the activation of programmed cell death processes seen in the brains of patients with Alzheimer’s disease and other neurological conditions, in an attempt to maintain neural function. Blocking parts of that process has helped preserve brain tissue and enhance memory in animal models, the company said.

“There is a critical need to develop medicines that slow or stop neuronal loss in these patients, and a growing body of data suggests that inhibition of these specific pathways has the potential to preserve neuron viability across a variety of disease states and pathological conditions,” said Jim Ray, Ph.D., director of Neurodegeneration Consortium, a drug discovery initiative comprised of MD Anderson, MIT, Baylor College of Medicine and Mount Sinai’s Icahn School of Medicine.

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Neurodegenerative diseases and neuronal injury affect nearly 20 million people in the U.S., the company said, with incidence expected to increase as the population continues to age.

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Magnolia emerged with $31 million in series A financing, backed by the venture capital and innovation arms of AbbVie, Eli Lilly, Johnson & Johnson, WuXi AppTec and Pfizer—which cut its own neuroscience R&D programs in January, favoring VC efforts instead.

“Our new focus on neuroscience investing is designed to support entrepreneurs who are deciphering the molecular basis of neurologic disorders, and we believe that Magnolia Neurosciences has the technology and scientific foundation on which to build an exciting portfolio of neuroprotective medicines,” Laszlo Kiss, executive director of worldwide R&D and principal at Pfizer Ventures, said in a statement.

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Other Magnolia financiers included Alexandria Venture Investments, ARCH Venture Partners, 180 Degree Capital, Innovate NY Fund, Watson Fund and the Partnership Fund for New York City.

“The potential market for neuroprotective therapies is large and underserved, and we believe that Magnolia Neurosciences has the technology, intellectual property and scientific expertise to become a leader in the field,” said Accelerator CEO Thong Le. Magnolia’s offices will be located in Manhattan’s Alexandria Center for Life Science campus.