A Bethesda company that’s developing technologies to measure brain injuries is the first recipient of venture capital under the state’s $84 million InvestMaryland program.
Privately-held BrainScope is working on tools to diagnose traumatic brain injuries, including concussions, in military, hospital and sports settings. It previously received a state investment and has won multimillion-dollar federal contracts to support its work.
The InvestMaryland program was the centerpiece of Gov. Martin O’Malley’s economic development package in 2011. It’s designed to raise investment capital by auctioning tax credits to insurance companies; the first auction raised $84 million in March. Most of the proceeds are to be invested by private venture capital firms in small technology companies, with the state also making such investments. BrainScope is receiving $250,000 from the program.
O’Malley (D) made the announcement Monday at BrainScope’s offices.
“Our investment in BrainScope and the launch of the InvestMaryland Challenge demonstrate that we believe in aspiring entrepreneurs and Maryland’s ability to compete and win in the New Economy,” he said in a statement.
“Traumatic Brain Injury remains one of the very top health issues for our servicemen and women, and concussion is a national topic of concern and conversation,” company CEO Michael E. Singer said in the statement. “These funds will support the development of our medical device to help first responders assess head-injured patients. We thank the State of Maryland, in particular the Maryland Venture Fund, the Department of Business and Economic Development and the Governor, for their support as we work to develop these important products.”
This month, BrainScope reported winning a two-year, $2.7 million contract from the Army to develop a hand-held device to quickly diagnose traumatic brain injury in the field. The contract will help the company merge the technologies in its system with current smartphone technology, the company said in a statement.
The technology records brain electrical activity with a handheld, non-invasive, non-radiation emitting medical device, and utilizes advanced algorithms that quantify and characterize features of brain electrical activity associated with traumatic brain injuries, including concussions, according to the company. The system is intended for use as an adjunct to standard clinical practice.
The new deal follows an 18-month, $7.5 million Pentagon contract the company won in December to study its technology in emergency room settings. At that time, the company also received an initial investment of $250,000 from the Maryland Department of Business and Economic Development through the Maryland Venture Fund
Two, three-year studies were published this year demonstrating that the company’s technology can show the extent of brain injuries in scholastic football players who sustained concussions, plus indicate their recovery and readiness to return to play.
The company’s private backers are Revolution, Alafi Capital, Brain Trust Accelerator Fund, Draper Fisher Jurvetson, Portage Ventures and ZG Ventures.
O’Malley on Monday also announced the launch of the InvestMaryland Challenge, a $300,000 business competition designed to help identify and support Maryland startups. The idea is to connect top companies with mentors, venture capitalists, other potential investors and resources such as incubator space and legal services, according to O’Malley’s statement.
The program offers three, $100,000 prizes to companies in three categories: information technology, life sciences and an open category. Inc. magazine is a national media partner for the program.
Companies with fewer than 25 employees and less than $1 million in annual revenues are eligible to apply. Those applying in the first two categories must be in-state companies; out-of-state companies also may apply in the open category, but must be willing to relocate to Maryland if they win.
Business leaders throughout Maryland will judge the entries, which must be filed online at InvestMarylandChallenge.org by Dec. 13. Judging will be in February, with winners announced in March.