A sample due diligence case from the perspective of PlexoA’s scientific advisory team.
Scenario
A venture capital (VC) firm is considering a $2M seed investment in a startup developing a bispecific antibody designed to redirect T cells to attack solid tumors.
The startup’s lead asset, called TCX-101, binds to a tumor antigen found in ovarian and pancreatic cancers and activates T cells via CD3. Their preliminary results showed tumor shrinkage in mouse models.
The startup’s pitch sounds impressive—but the investors need to know:
- What’s the risk of investing now versus waiting?
- Is the science strong enough to move toward human trials?
- Are there red flags in the data that haven’t been mentioned?
- Is this approach truly novel compared to others in the space?
Breakthroughs in biotech don’t happen by chance—they happen by asking the right questions early. At PlexoA, we believe rigorous science, clear thinking, and strategic timing are what turn bold ideas into transformative therapies. Our goal is to help innovation move forward—not faster, but smarter.
What PlexoA Would Do (Step-by-Step Due Diligence)
1️⃣ Scientific Feasibility Review
What we’d evaluate:
- Target expression: Is the tumor antigen only in tumors, or also in healthy tissue? (Off-tumor toxicity = serious risk.)
- Mouse model relevance: Are their models predictive for human results?
- Mechanism soundness: Will CD3 activation cause cytokine release syndrome?
📌 Example insight:
PlexoA finds the antigen (let’s say “Antigen-X”) is also expressed in lung tissue at low levels—raising concern that the therapy could harm healthy cells. This is a red flag for off-target effects that hasn’t been addressed in the pitch.
2️⃣ Translational Readiness
What we’d evaluate:
- Is there a plan for GLP toxicology studies?
- Are biomarkers identified to track response or safety?
- Are they preparing for manufacturing and CMC processes?
📌 Example insight:
The company has strong academic data but no clear plan for GMP manufacturing of the antibody—a common stumbling block in early-stage biologics. This may delay their timeline to IND (Investigational New Drug) filing by 12–18 months.
3️⃣ Competitive Analysis
What we’d evaluate:
- Are there 10 other companies already working on Antigen-X?
- Is this a “me-too” therapy, or truly differentiated?
- Are large pharma companies active in this space (potential exit opportunities)?
📌 Example insight:
We find three other startups also developing T-cell engagers against Antigen-X, but TCX-101 is the only one using a novel linker technology that may reduce toxicity. This is a unique value proposition that adds credibility.
4️⃣ Risk Summary & Decision Support
What PlexoA would deliver:
- A summary report showing:
- What’s promising
- What’s missing
- What’s risky
- A go/no-go recommendation or suggestions for negotiation
📌 Example insight:
We recommend the VC proceeds with investment only if the company completes additional safety studies to de-risk off-tumor effects. We suggest a milestone-based funding approach, tied to completion of those studies.
Why It Matters
Biotech innovations often sound exciting—but lack of deep technical review leads to:
❌ Wasted capital on unviable programs
❌ Missed safety issues that stall development
❌ Overestimation of innovation
With early-stage immunotherapies, these risks are common. This case shows how objective, science-led due diligence protects investors and ensures that promising science moves forward responsibly.
Summary at a Glance
| Area | Key Findings |
|---|---|
| Science | Strong concept, but risky antigen profile |
| Translation | Needs a stronger IND prep plan |
| Competition | Moderate crowding, some unique tech |
| Decision | Proceed if key safety gaps are addressed pre-funding |
Leave a Reply