See the pitch deck a doctor used to sell F-Prime on his vision for an entirely new way of testing experimental drugs and win a $250 million valuation
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- The clinical-trial startup Castor just raised $45 million from investors including F-Prime Capital.
- The Series B valued the startup at $250 million, according to a person with knowledge of the deal.
- Castor aims to use the data it’s collecting now to create simulated trial subjects by 2035.
Derk Arts was originally planning to become an anesthesiologist.
But when he started training at the Medisch Centrum Alkmaar hospital in the Netherlands and found that his department still used Excel spreadsheets to compile data, everything changed.
Arts created a software program and launched his startup, Castor, in 2012.
The Hoboken, New Jersey-based company operated quietly before raising its first seed funding in 2018. The company raised a $45 million Series B round earlier this month from F-Prime Capital, Eight Roads Ventures, Two Sigma Ventures, and Inkef Capital.
The round valued Castor at about $250 million, according to a person with knowledge of the deal.
Arts declined to disclose Castor’s 2020 revenue or 2021 projections.
The COVID-19 pandemic has shifted focus onto how clinical trials are run, simply because the coronavirus forced many in-person trial sites to shut down temporarily. But even before the pandemic, 35% of trials shut down due to underenrollment, according to Castor.
Arts’ aspiration is to transform Castor from a company that helps track and manage trial participants’ data to a firm that can digitize the entire process — even the patients.
He thinks that by 2035, Castor’s computer systems could simulate trial subjects.
It was part of his pitch to investors. Like Google, 23andMe, and Novartis, Castor knows there’s hordes of potential in the data it’s collecting.
“For investors, direct paper replacement doesn’t resonate,” Arts said. “We have a vision that extends way beyond the current paradigm of clinical trials.”
Drug companies have used data to create virtual trial participants. But in most cases, it’s used to replace the placebo patients — the people who don’t get a drug — when testing treatments for rare diseases.
Castor plans to use its Series B funds to work on its technology and hire.
The company has more than 100 employees. Arts said Castor plans to have between 250 and 300 employees by the end of 2022.
Note: This article has been updated to remove the names of Castor’s confidential clients.
Here are the slides showing Castor’s plans for upending clinical trials:
Derk Arts started Castor as a solution to a problem he was facing during his medical training and research: effectively capturing patient data.
Since its founding in 2012, Castor has been used on more than 7,500 decentralized clinical trials. Decentralized clinical trials replace paper records and in-person visits at medical centers with software that can capture information on how the medical treatment or preventive measure is working.
The market for new clinical-trial technology boomed during the pandemic. About 80% of drug trials that didn’t involve a COVID-19 vaccine or treatment were stopped or delayed because hospitals shut down nonessential visits.
The market for decentralized clinical trials is expected to grow from $2.5 billion to $10 billion by 2026, according to KBV Research.
Castor typically charges around $10,000 annually to commercial drug companies and research institutions, but the price can reach up to $50,000 per year.
Digitizing clinical trials can help them run faster and more efficiently, according to Castor. The company says its software cut the time for getting the first patient started in a trial by 60%.
The World Health Organization used Castor’s software last year to test four possible COVID-19 treatments internationally.
The study, called the Solidarity Trial, examined how Gilead Sciences’ remdesivir and the controversial drug hydroxychloroquine performed against the coronavirus. The study followed about 12,000 people from 30 countries.
Interim results reported in October 2020 showed that none of the treatments tested led to shorter hospital stays, less use of ventilators or reduced patient mortality.
Castor’s long-term plan is to use the data it collects to become a leader in computational clinical trials, where human participants are replaced by or augmented with virtual “patients” created by computers based on data from all of the trials Castor is now running.
To do that, Castor will need to grow its database and use tools like artificial intelligence and machine learning to weed out poor quality data.
Arts said Castor will stand out from competitors by building greater technological capacity that will allow it to capture more data.
“What I see is a lot of tech that can claim to do a lot of things, but only for small number of customers at high price,” Arts said.