DANVILLE, VA – March 6, 2018 – Governor Ralph Northam today announced that Panacea Biomatx, a manufacturer of personalized medicine and nutrition solutions, will invest $5.8 million to establish a research and development and high-tech manufacturing facility in the Cane Creek Centre Industrial Park in Pittsylvania County. The project will create 70 new jobs.
With a global audience and competitive market, oral medication is one of the leading drivers in the billion dollar pharmaceutical industry. According to a 2013 study conducted by The Mayo Clinic, 20 percent of Americans take five or more medications daily, a majority of these being senior citizens. With individuals who have cardiovascular or other severe medical conditions, doctors claim it is a challenge to get them to take all of their regulatory pills daily—which can be up to 20. This can lead to worsened health problems or even loss of life.
Additionally, standard pill regimens lack the personalization to fully meet any one pill taker’s needs. As with any problem, there are those that recognize the gap and say, “There has to be a better way.”
This was the case for Edison Hudson and Staton Noel. Together, they searched for a means to repair the “one pill fits all” method that was circulating the industry when they started Panaceutics (a subsidiary of Panacea Biomatx, Inc.) in 2013. Pushing towards the future of pharma and nutraceuticals, Hudson and Noel combined years of experience in pharmaceuticals, robotics, and software innovations to develop a process to deliver personalized medicine that would not only meet the needs of an individual, but would also be easy to consume.
However, starting from scratch in a regulated, high dollar market proved to be a challenge. In 2015, Panaceutics received a $250,000 seed investment from The Launch Place , making them the fifth company to join The Launch Place’s portfolio . “The initial investment was made to enable Panaceutics to expand its robotic manufacturing technology in order to position the company at the front of the shifting pharmaceutical industry”, said Eva Doss, President and CEO of The Launch Place.
“Seed-stage funding typically entails a small investment aimed at financing the early development of a product. Companies can apply for venture capital when a product is further along in development, which can lead to multimillion dollar deals with high returns”, Doss explained.
“For us, raising early capital was difficult,” says Noel. “Really, The Launch Place was one of the only institutional investors interested in helping early stage companies, and they have a very good model for companies like us.”
During the last 3 years, The Launch Place has invested an additional $250,000 in Panaceutics.
The Launch Place’s Seed Fund Advisory Board member Ken Ferris says that not only did the board like Panaceutics’ leadership team and product during their pitch, but their authenticity separated them from the rest. “It just felt like it was a great fit for Danville,” Ferris says. “and Panaceutics was serious about making a long-term commitment to the Dan River Region.”
Today, Panaceutics is reshaping pharma and nutraceuticals by delivering personalized monthly subscriptions of “pill free” portable nutritional pouches, combining up to 20 active ingredients that offer a convenient way to consume medications, vitamins, and supplements. Each pouch will deliver the right nutrients and correct dosage for each individual, reducing drug related side effects or adverse events. Pouch flavors include combinations like Mango Blend, Apple Spice, and more.
During their early stage development, Panaceutics successfully raised $1 million in investments, which allowed them to move into First Flight Venture Center, a business incubator located in the Research Triangle Park (RTP), North Carolina in early 2015. But as demand grew for the personalized nutritional packet, so did the need for additional space. Virginia Governor Ralph Northam announced Panaceutics will expand its manufacturing operations to Pittsylvania County in the Dan River Region.
Panaceutics’ expansion will create an estimated 70 jobs, adding millions to the annual revenue of the Dan River Region. This move goes well beyond the partnership requirements of The Launch Place, which states that a company must establish a mininimum of five jobs in the Dan River Region in three years as part of their investment criteria .
“This will have a huge impact,” says Jimmy McGarry, Chair of The Launch Place’s Board of Directors. “This move is a perfect example of collaboration between new businesses we bring into the area and the available space, existing workforce, and ability to train new talent.”
CEO of Panaceutics, Mark Montgomery, says the company is excited to move to their 12,500 square foot plant in April, and that Danville is the perfect community for them.
“Making this move to Danville will open up doors and not only allow us to get more recognition as a company, but also to get recognition for The Launch Place.” Montgomery adds that this move will create opportunities for more national and international partnerships, as well as the ability to serve more clients.
But the space wasn’t the only thing that interested Panaceutics in Danville. The proximity of the Institute for Advanced Learning and Research will ideally offer Panaceutics top talent that are trained and certified in advanced machinery and controlled systems.
“There’s an untapped market, particularly if you look at the technology and training that is available in the community,” Montgomery says about Danville. “A lot of talent may go unrecognized.”
The plant they are expanding to will house their second automated machine that produces their nutritional pouches, doubling their output. Each machine can serve up to 15,000 clients a month. As interest for their product grows, Panaceutics can easily add lines or even build onto the plant with the 23 acres at hand on their new property.
President and CEO of The Launch Place, Eva Doss, admits that the investment was a risk, but The Launch Place could not deny Panaceutics’ potential in the shifting market.
“We believed in the founders, and decided to move forward because we saw trends shifting in the industry, where people no longer wanted to take multiple pills a day,” says Doss. “It was such a novel idea, but we believed they would make a change to the industry.”
The Launch Place will continue to partner with Panaceutics and provide them with business services as needed and introduce them to other venture funds to push Panaceutics forward.
“We have really enjoyed working with Eva and the board,” says Noel. “They are very supportive, open, and don’t let us get in our own way. It is obvious that they want us to succeed.”
Looking towards the future, Panaceutics has five product launches planned with billion dollar partners in their network. They also plan to experiment with new delivery systems for their nutritional pouches. Hiring for the plant expansion is scheduled to begin at the end of 2018.