Billionaire Thiel backs biotech startups with eyes on Alzheimer's, GI disease

Breakout Labs founder Peter Thiel

Breakout Labs, a science investing venture from PayPal billionaire Peter Thiel, is staking three biotechs at work on early-stage therapies for Alzheimer's disease, gastrointestinal disorders and bone surgery.

Cortexyme, G-Tech Medical and EpiBone are the latest additions to Breakout's roster of science startups, each due up to $350,000 to advance their proprietary treatments and technologies. The nonprofit leaves all intellectual property to its beneficiaries, taking instead what it calls "a capped royalty stream and a small percentage of equity" while introducing each company to a syndicate of potential follow-on investors. All of Breakout's revenue funnels back into its general fund for future investments, the company said.

First among the latest Breakout additions is Cortexyme, a San Francisco outfit out to tackle the industry-beguiling problem of Alzheimer's. The biotech is developing a small-molecule treatment targeting a specific, undisclosed pathogen tied to neurodegeneration, based on the work of co-founder and University of California, San Francisco, professor Stephen Dominy. Breakout's support will allow Cortexyme to get rolling on animal model studies and develop a diagnostic test and treatment-monitoring method, the company said.

Next up is G-Tech Medical, a Bay Area device outfit at work on an "EKG for the gut." The company is developing a wireless, wearable sensor system that detects muscle activity in a patient's gastrointestinal tract and then pools and transmits that data to a smartphone and cloud-based platform. Over time, the device paints a picture of GI health and, ideally, allows physicians to ferret out the root causes of functional disorders and better target their treatment decisions. G-Tech is a company in residence at Menlo Park's Fogarty Institute for Innovation, where it's at work on the patch-based device.

Finally, New York City's EpiBone plans to use its Breakout funds to advance a stem cell-based solution for bone growth. The biotech's technology uses CT scans and fat-derived stem cells to engineer patient-specific living bone grafts, the result of 15 years of NIH-sponsored tissue-engineering research, the company said. EpiBone believes its early-stage technology can simplify procedures and shorten recovery times for the roughly 900,000 patients who undergo bone-related surgery each year.

The latest additions bring Breakout's roster of companies to 19, including the biomarker researcher CytoVale, nano drugmaker Siva Therapeutics, immunotherapy outfit Immusoft and oral biologics developer Longevity Biotech.

- read the announcement