Startups, Diagnostics

UPMC backs cancer diagnostics startup Cernostics

Cernostics is part of the wave of oncology that looks at cancer at the tissue and cellular level instead of focusing on the location of the tumor — lung, stomach, pancreas.

The molecular technology being developed to spot cancer may be less iconic than the old image of pathologists bent over a microscope looking at tiny cells trapped between glass slides. But algorithms and cells have spurred a market teeming with venture capital and startup labs.

One of those startup-style labs is Cernostics, which just received an initial investment of $1.3 million toward a $5 million funding round. The money came from Novitas Capital and UPMC Enterprises, the healthcare investment arm of the nonprofit University of Pittsburgh Medical Center.

This recent infusion of cash will help Pittsburgh-based Cernostics build out the sales and marketing of a test that identifies patients at risk of developing esophageal cancer — before they develop cancer. But the technology, known as TissueCypher, can also be used to develop tests for lung cancer, breast cancer and colon cancer.

“The financial investment is exciting,” said Cernostics CEO Mike Hoerres.

However, he said the partnership with UPMC is equally exciting. The medical center has world-renowned clinicians, a broad provider network, an in-house insurance plan, and the technology and business know-how of UPMC Enterprises, he said. “That’s a tremendous advantage,” Hoerres said.

Cernostics is part of the wave of oncology that looks at cancer at the tissue and cellular level instead of focusing on the location of the tumor — lung, stomach, pancreas.

The company’s most advanced product uses digital imaging to test people with Barrett’s esophagus, a disorder that actually develops to help protect the stomach but often ends up corroding the lower esophagus. More importantly, Barrett’s can be a precursor to esophageal cancer, which about 1-in-125 U.S. men and one out of every 435 women are at risk of developing, according to American Cancer Society figures. Only about 20 percent of patients survive at least 5 years after diagnosis.

Cernostics’ growth translates into reaching more clinicians and their patients with better care by giving them tools to do a more effective job. They can identify patients that need advanced treatments, and spare others unnecessary procedures, Hoerres said.

“They can get patients the right treatments at the right time,” he said.

Ultimately the goal is to see fewer cancer patients and offer less invasive care for those who are healthy. That’s an advantage for UPMC, too, because having to run fewer tests saves money for the tightly integrated health system.

UPMC shares those goals, but bringing such efforts to life will require sophisticated tools and technologies, Tal Heppenstall, president of UPMC Enterprises, said in an email. “That’s why we’ve invested in and partnered with Cernostics,” he said.

The relationship will allow UPMC clinicians to explore whether this platform might create a broad array of precision medicine tests that will, Heppenstall said, “improve the quality and lower the cost of healthcare.”

Cernostics has received $11 million since 2010 including $360,000 from the Ben Franklin Technology Partners of Northeastern Pennsylvania, the state’s economic development arm. The company also received an injection in 2014 of $100,000 in follow-on funding. That money came on the heels of a Series B round raised in the third quarter of 2013 from Novitas Capital, Geisinger Health System and the Pittsburgh Life Sciences Greenhouse.

Photo: Cernostics

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