EDITOR'S NOTE: From a security software maker to the developer of an implantable spinal cord neuromodulator, the Business Journal highlights seven spun-out ventures looking to ride the lab coattails of USC, UCLA and Caltech.


Product: Technology for transporting therapeutics across the blood-brain barrier into the central nervous system.

Founder: James Callaway

Year Founded: 2004

Location: Calabasas

What does the product do?

We are developing enzyme replacement therapies for Hurler and Hunter syndromes, two rare diseases. Fewer than 10,000 people have these diseases in the United States. Our job is to provide a mechanism to deliver these enzymes across the blood-brain barrier to the central nervous system to treat the disease. It’s a major technical challenge because the blood-brain barrier protects the central nervous system from foreign molecules, including potential therapeutics. Our products could also be used to potentially treat other rare diseases of the central nervous system as well as Alzheimer’s, Parkinson’s and neuroinflammation.

What was the idea that led to the creation of the company?

ArmaGen’s founder, Dr. William Partridge, realized that the best way to cross the blood-brain barrier was to manipulate the body’s natural infrastructure to accept the medication, almost like using a Trojan horse to slip across the barrier.

What has been the benefit of spinning the company out of UCLA?

The major benefit was expansion. UCLA was where the initial research on the biological mechanisms that move insulin and other molecules across the blood-brain barrier was conducted. In 2004, Dr. Partridge used small-business innovation and research grants to transition ArmaGen from a small startup into a commercially viable operation. After nine years, he was able to secure financing from pharmaceutical venture capital funds to continue that expansion into a clinical operation.

What has been the biggest change since spinning off?

Having access to professional biotech and management personnel to take this early stage technology and move it forward through preclinical development to today, where we are poised to begin human clinical testing.

How can the product change society?

No one has been able to solve the blood-brain barrier penetration problem. All of neuroscience and CNS disease research could potentially benefit from ArmaGen’s success.

If you could go back in time and do something differently, what would it be?

It’s easy to say, but getting Series A financing sooner would have been a significant benefit. The 2008 financial collapse delayed the development of ArmaGen. The second thing is getting pharmaceutical input earlier because ultimately our goal is to partner with the large pharmaceutical companies.

What were some of the challenges in developing the company?

As with most companies, funding was No. 1. In order to secure funding, ArmaGen needed to present our solution to get past the blood-brain barrier to a highly skeptical venture capital audience. Penetrating the barrier has been a problem for pharmaceutical researchers for the last 30 years and the skepticism that built up over that time was difficult to overcome. Fortunately, we found a syndicate of investors who were willing to take a chance and fund our approach.

What’s next for the company?

Filing an application with the Food and Drug Administration in the first half of 2014 to enter human clinical trials.