U.S. coronavirus cases and hospitalizations are surging, with cold weather arriving before even the best-case scenario for a widely distributed vaccine. Now we're also beginning to see an increase in coronavirus-related startup funding, focused on both testing and pharma.
Driving the news: Gauss, a Silicon Valley computer vision startup focused on health care, tells Axios that it's raised $10 million to accelerate development and commercialization of an at-home rapid antigen test for COVID-19.
- Gauss was founded in 2011 to focus on surgical bleeding, but earlier this year signed a partnership with biotech Cellex to create what would be the first rapid COVID-19 test that can be fully performed at home without involving a lab.
- CEO Sid Satish says that Gauss will file with the FDA for an emergency use authorization "in days not weeks" and will release its data soon.
- The 4100 Group led the round, and was joined by return backers SoftBank Ventures Asia, Northwell Health, Providence Health and Services, OSF Healthcare, and Polaris Partners.
Other deals have included a $215 million infusion for antiviral treatment developer Atea Pharma (which is now nearing an IPO) and a $100 million deal for portable testing company Cue Health.
Between the lines: The big concern for venture capitalists is that some startups will put too many eggs in the COVID-19 basket, and then be stuck when demand shifts.
- Satish says his company is trying to mitigate that risk by maintaining its pre-pandemic products and customers, but adds that controlling spread is just an initial application for COVID-19 testing.
- "You'll need some overlap of testing as a safety net and bridge to when a significant portion of people have been vaccinated. And, even with a vaccine, I think easy rapid testing will be a long-term necessity as a risk reduction method."
