Atmo Biosciences, a digital health company incubated by Planet Innovation that is developing the world’s first ingestible gas-sensing capsule for monitoring gut health, has closed an oversubscribed A$9.6m capital raise.
The raise was led by two new cornerstone investors – Sydney-based investment firm Alium Capital Management and Japanese multinational company Otsuka Pharmaceutical.
The funding will enable Atmo to accelerate product development of its gas-sensing capsule, which detects clinically important gaseous biomarkers produced by the gut microbiome as it travels through a person’s gastrointestinal system, and transmits the data to the cloud for analysis.
The new capital will also allow Atmo to undertake the clinical studies required to file an initial FDA submission for US regulatory clearance around the use of Atmo’s capsule to assess gut motility and transit time using gas profile‑based location signatures.
Atmo will also continue clinical studies directed towards expanding into a major new commercial opportunity for SIBO (Small Intestinal Bacterial Overgrowth). SIBO is a gastrointestinal disorder which is believed to affect up to 5 to 15 per cent of the population. However, the most commonly used diagnostic test for it, the hydrogen breath test, is widely recognized as being unreliable, and more accurate methods, such as sample collection and cultivation, are highly invasive, expensive and face several procedural challenges. Atmo’s capsule has the potential to directly collect functional data from within the small intestine that could assist with the evaluation and management of SIBO.
Malcolm Hebblewhite, CEO of Atmo Biosciences, said: “With one in five people suffering from a gastrointestinal disorder in their lifetime, there has been an explosion of interest and understanding about the impact of the microbiome on many aspects of a person’s health.
“However, one of the big challenges is that the gut is very long, with much of it inaccessible, and it is hard to know what is going on in there. Many microbiome companies are profiling a person’s microbiome, effectively looking at what microbiota are present. Atmo is taking a slightly different approach by using the gas profiles throughout the gut to look at how those microbiota are functioning.
“The commercial potential in this area was clearly reflected in the strong interest we received during this capital raise. We had to upscale the raise to accommodate our two new, significant shareholders, Alium and Otsuka, as well as the strong demand we had from our existing and a number of new, sophisticated investors.”
Jason Rich, Partner at Alium Capital, said Atmo Biosciences was a great match for the company’s Alpha Fund, which is focused on pre-IPO technology and innovation companies.
“We’re really excited by Atmo Biosciences’ technology. Gut health is increasingly being recognized for its importance to overall health and wellness, and a key part of that is understanding microbiome function. We see huge commercial potential in Atmo’s ability to provide insights into the health or dysfunction of a person’s gastrointestinal system and gut microbiome,” Mr Rich said.
Mr Hebblewhite said the relationship with Otsuka was strategic for Atmo.
“Otsuka brings not just funding, but a global presence through access to its well established and extensive product development resources, its customer focus, and distribution networks cutting across pharmaceuticals, consumer products and medical devices,” he said.
