Newcells Biotech secures £1.2 million backing

A Newcastle-based biotech company pioneering advanced lab models to help accelerate drug development has secured £1.2 million funding from existing investors.

Newcells Biotech, known for its 3D models mimicking human tissues, plans to use the funding from Mercia Ventures, Northstar Ventures and North East Finance, to “exploit the growing demand” by exploring strategic partnerships with complementary companies and enhancing its offering to customers.

The models, which replicate the retina, kidney and lung, are used to test drugs in development, offering a “faster, more effective” and ethical alternative to animal testing.

The technology supports pharmaceutical firms by improving decision-making, reducing costs and speeding up drug development timelines.

Interest in such models has grown since the US FDA removed the mandatory requirement for animal testing in 2021.

Research shows approximately 90 per cent of drugs deemed safe in animals fail in humans, highlighting the need for more predictive methods such as those offered by Newcells.

Founded in 2015 by Dr Mike Nicholds and Professor Lyle Armstrong as a Newcastle University spin-out, Newcells employs 42 staff and works with pharmaceutical companies globally.

As part of the latest funding round, the company has appointed Dr Mark Carnegie-Brown, who has more than 30 years’ leadership experience in corporate and biotech environments within the pharma industry, as chair.

Dr Nicholds said: “We believe that providing better laboratory models enables a faster, more effective drug development process which in turn accelerates the delivery of new therapies to patients. 

“Newcells’ models have proven to predict how drugs interact with tissues and organs.

“We have seen an upturn in demand since the FDA removed the requirement for animal testing and expect the trend to continue as more companies rethink and adapt their processes.

“This latest funding demonstrates the continued confidence of our investors and will enable us to exploit the growing demand.”

The funding has come from Mercia Ventures’ Northern Venture Capital Trusts and three regional funds - the North East Venture Fund, managed by Mercia; the North East Innovation Fund, managed by Northstar Ventures; and the Finance for Business North East Fund, managed by North East Finance – all of which are supported by the European Regional Development Fund.

Victoria Wiesener, portfolio director at Mercia Ventures, said: “Newcells has a great product and a strong team, and has the potential to become a leader in its field.”

Alex Buchan, investment manager at Northstar Ventures, added: “We have been closely involved with Newcells since its founding, and are proud of its significant progress to date.”

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