Newcells Biotech raises £2.35 million for lab models that help avoid animal testing

Newcells Biotech has raised £2.35 million to boost its growth.

The latest funding round will enable Newcells – whose laboratory models are used in drug development and reduce reliance on animal testing – to enhance its offering with the use of powerful imaging technology.

The company also plans to create ten jobs.

The Newcastle-based firm has secured funding from existing investors including the North East Venture Fund, which is supported by the European Regional Development Fund and managed by Mercia Ventures, Mercia’s own funds and Northstar Ventures.

It brings the total raised by the company to date to more than £12 million.

Newcells’ 3D models mimic processes within the body and are used by pharmaceutical companies worldwide to test the impact of their drugs.

They provide robust data to support critical decisions, such as whether to continue development and commence human trials.

A spin-out from Newcastle University, Newcells was founded in 2015 by Dr Mike Nicholds and Professor Lyle Armstrong.

It increased revenue by 56 per cent in the last financial year.

Dr Nicholds, chief executive, said: “The support from our investors has allowed us to grow the business to the point where we now work with more than 100 customers internationally, including large pharma and biotech companies.

“This latest investment will further enhance our technology and underpin our ability to continue our rapid growth.”

Alex Simpson, of Mercia Ventures, said: “By improving the models available to scientists, Newcells is not only helping pharma companies avoid the use of animals but also improve the efficiency of drug development and deliver new therapies to patients.

“The company is already recognised as a pioneer in its field, and the latest funding will help establish it as the market leader.”

Dr Alex Buchan, investment director at Northstar Ventures, said: “From Northstar’s first investment in 2016, we have seen Newcells continue on its growth trajectory, building a suite of assays for the biotech industry.

“We believe in the team’s ability to scale quickly, as Newcells has evidenced real momentum selling into a global customers.

“This investment will help Newcells establish itself as a global leader in its field.”