Johnson & Johnson, Pfizer, Eli Lilly and other big pharmas are backing this San Diego biotech with $175M

"It's just impractical to get it to most people," Shawver said. "So as a result, a number of companies are trying in vivo (inside the body) approaches to deliver directly to T-cells that can then fight the diseases once they're engineered in the body.

"This is why our industry needs to have a different approach so that we can bring it forward to more people in an easier way."

Capstan encodes mRNA and packages it in a lipid nanoparticle that is "decorated" with an antibody, which directs the body's T-cells to attack problematic cells.

There are broad applications for this platform technology, Shawver said, but right now Capstan is looking at ways to treat cancer, fibrosis, and autoimmune and genetic blood disorders.

In essence, its lead therapy for autoimmune disorders targets the B-cells that are causing an overreaction of the immune system, which translates to symptoms. It would clear away those B-cells and make room for new, young cells that aren't triggered to overreact.

She said the latest round of funding will help the company expand its operations a little bit and advance its lead therapy to the clinic. The company has 79 employees and operates out of Alexandria GradLabs in La Jolla.

Capstan also has major institutional investors who participated in its latest fundraising round, including Forbion, Mubadala Capital, Perceptive Advisors, Sofinnova Investments, Alexandria Venture Investments, OrbiMed, Polaris Partners and Vida Ventures. Shawver said she's grateful that they have the support of investors from both big pharma and traditional firms who believe in Capstan's potential.

While it's true San Diego has seen deals pick up in recent months, it's been harder for startups to raise funds. Overall, venture capitalists are being more selective about investments compared to the heydays of 2021 when money was flowing at record levels.

Shawver has been around to see the pendulum swing both ways in this industry. Prior to leading Capstan, Shawver was CEO of Silverback Therapeutics and also Synthorx, which was acquired by Sanofi.

In 2023, financing rounds for biotech companies exceeding $100 million were rare. But Shawver said things picked up following some big deals — like the $4.1 billion acquisition of RayzeBio by Bristol Myers Squibb — in the fourth quarter of last year when Capstan started fundraising for this latest round.

"These M&A exits freed up some capital for investors to reinvest in new companies," she said.

Market interest in local life science companies has picked up more recently.

This month, San Diego saw its first two life science IPOs in months — Boundless Bio and Contineum Therapeutics — to kick off 2024. On Tuesday, local biotech Engrail Therapeutics said it exceeded its financing goal by closing a $157 million Series B round.

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