Daily Business Report-Dec. 19, 2019
The new Truvian Sciences lab in its new headquarters in University Towne Centre.
Truvian Sciences announces $27.1 million financing
as it settles into new headquarters in San Diego
San Diego-based Truvian Sciences recently announced a $27.1 million Series B financing, bringing the company’s total funds raised to date of $46.3 million, as well as its plans to develop an automated benchtop blood testing system for rapid assessment of a full suite of patient health tests.
As Truvian settles into its new headquarters in San Diego today, it plans to use the latest Series B capital for validation studies as it works toward regulatory approval in the next year. Truvian also plans to seek approval in Europe and from the FDA by the end of 2020.
The company relocated its headquarters to University Towne Centre on Campus Pointe Drive in a 449,759-square-foot facility complete with a cutting-edge lab, an organic garden that provides food for the restaurant, but local employees as well, soccer fields, a state-of-the-art training facility and hiking trails.
Truvian is developing a blood-testing device that can perform routine diagnostics in about 20 minutes—a fraction of the time it would take for traditional lab services—using a small sample of blood. The company is targeting retail clinics, like those at Walmart and CVS as well as outpatient primary care and corporate clinics. To that end, the machine they have developed uses dry reagent technology that eliminates the need for cold storage, and results are delivered digitally through a web application.
“Our platform is designed for flexibility allowing medical personnel the option for capillary sampling (finger stick) or venous blood sampling for a more comprehensive view of a patient’s health,” said Jeff Hawkins, president and CEO.
The first commercialized device will conduct 40 of the most commonly ordered tests, such as metabolic panels, complete blood cell counts, and thyroid, liver and kidney function.
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How California’s ‘woman quota’
is already changing corporate boards
By Martha Groves | CalMatters
For 46 publicly held companies in California with all-male boards, the clock is ticking.
The corporations, including pharmaceutical, financial and software companies that tend to be on the smaller, younger side, have only until revelers ring in 2020 to name a woman to their boards of directors or face a $100,000 penalty.
A bill signed into law by former Gov. Jerry Brown in September 2018 required public companies with headquarters in California to name at least one female director by the end of 2019. The law further mandates that companies with five-member boards have at least two female directors by the end of 2021; corporations with six or more directors need at least three women. The penalties for failing to comply rise accordingly.
The Golden State became the first in the nation to legislate the requirement for female board members, inspiring lawmakers in Massachusetts and New Jersey to introduce similar proposals. Illinois enacted a pale version of the California law, requiring publicly traded companies to report each year their boards’ demographics and plans to promote diversity.
Researchers tracking the situation in California say the new law appears to be having the intended effect, with more than 90 percent of publicly traded companies based in the state now in compliance — and with women added to at least two dozen all-male boards just since July. But the measure has also drawn legal challenges, as many observers predicted.
In acknowledging “serious legal objections” to the law, Brown said when he signed that it was nonetheless important to send a message to the male-dominated business world. That message has resulted in at least two lawsuits. One was filed in November by the libertarian Pacific Legal Foundation, a public interest law firm, on behalf of a shareholder of OSI Systems Inc., a manufacturer of airport security, medical and other equipment based in Hawthorne.
In that suit, filed in U.S. District Court in Sacramento, Creighton Meland Jr., a retired corporate attorney, maintains that the “woman quota” would force him to discriminate when voting for OSI board members. Instead of voting for the best candidate, he said, he would have to consider the person’s sex as well. OSI, which did not respond to multiple requests for comment, has a seven-member board that includes founder and Chief Executive Deepak Chopra (not the internationally famed holistic medicine proponent).
“We’re not claiming that the injury to him is having a woman on the board per se,” said Anastasia Boden, a senior attorney with the Pacific Legal Foundation who is handling the Meland case. “The injury is forcing people to make decisions based on sex.”
That would violate the equal protection clause of the U.S. Constitution, which was meant to create a sex- and race-blind society, she said, adding: “This law … just reduces people back down to their immutable traits.”
An earlier challenge was filed in August by Judicial Watch, a conservative group based in Washington, on behalf of three California taxpayers. That suit argues that spending taxpayer money to enforce the law would violate the state’s Constitution. Jill Farrell, a Judicial Watch spokeswoman, said the case was scheduled to be heard March 9 in Los Angeles County Superior Court.
Both suits name Secretary of State Alex Padilla, whose office handles corporate filings and processes the records of entities that conduct business in California. Padilla has asked a judge to throw out the Judicial Watch lawsuit, saying taxpayers have not been harmed and thus have no standing to sue. Paula Valle, a spokeswoman for the secretary of state, said his office would review the Pacific Legal Foundation suit and “respond in court.”
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Household income of $126,400 needed
to qualify to buy a house in San Diego
Times of San Diego
A minimum annual household income of $126,400 is required to qualify to buy a house in San Diego, more than double the $54,800 needed nationwide, a new study says.
“Furthermore, only 29 percent of households here can afford to purchase a median priced home compared to 31 percent in California and 56 percent nationwide (as of Q3 2019),” said Larry Cambra, director of brokerage in San Diego for Cushman & Wakefield, an international commercial real estate company.
He said San Diego rents are also rising while demand for less costly multifamily dwellings — including condominiums and rental units in apartment buildings near public transportation — is growing.
Those findings are part of a 14-page population study released Tuesday.
San Diego County, the second most populous in California with over 3.4 million residents, is heavily composed of younger people (39 or under) who comprise more than 1.86 million residents or 59 percent of local population, the study found.
“Millennials (25-39) are a large and critical group who also make up the largest working age generation in San Diego, representing 24 percent or 798,000 of the total population compared to 21 percent nationwide or 67.7 million of the total 328.2 million people,” said Jolanta Campion, local director of research for the company.
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SDCCD and UC San Diego receive combined
$2.7 million grant from the Mellon Foundation
The San Diego Community College District and UC San Diego have received a combined $2,7 million grant from the Andrew W. Mellon Foundation that will both expand an established, transformational program for transfer students and launch an initiative specific to career training for Ph.D. students — training that addresses a key need in employment after graduation.
The new grants will support five areas:
- Establishing an Integrated Internship Initiative for Ph.D. students interested in community-college careers,
- Increasing student outreach and retention through mentoring,
- Strengthening faculty connections between the two institutions,
- Using digital technology for collaboration and innovation, and
- Expanding support services in the annual Summer Academy for PATH students.
For the joint proposal, the foundation awarded two separate grants: $1.5 million to UC San Diego and $1.2 million to SDCCD, with programming to begin January 2020.
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How to tax marijuana
Dan Morain | CalMatters
Tocounter marijuana’s negative health impacts, California should scrap its methods of taxing cannabis and instead impose taxes based on its potency, the Legislative Analyst’s Office concludes.
Remind me: California taxes marijuana at every step of production and sale, including a 15 percent tax on retail sales.
Representatives of the legal weed business want legislators to cut taxes, contending that by lowering prices, legal dealers could better compete with the thriving underground market.
- The LAO is skeptical: “[W]hile a tax cut clearly would reduce the size of the illicit market to some extent (and a tax increase would expand it), we cannot quantify the extent of this effect.”
Lowering taxes would make legal weed more accessible to minors who are most sensitive to pricing, the analyst said.
The big recommendation: Base cannabis taxes on potency, similar to Canada’s marijuana tax.
Citing “substantial evidence” linking marijauna to schizophrenia or other psychoses, the LAO wrote:
“We recommend that the Legislature replace the state’s existing cannabis taxes with a tax designed to reduce harmful cannabis use more effectively—namely, a potency‑based tax or tiered ad valorem tax.”
Political prospects: The marijuana lobby has clout in the Legislature, and the industry resists claims of ill-effects.
- Most recently, the industry tried to block a state effort to place a warning on marijuana products that they can cause low birth weight, early deliveries, infant mortality or cognitive or health problems with children.
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Pipeline Therapeutics completes
$30 million Series B financing
Pipeline Therapeutics, a San Diego biopharmaceutical company focused on the development and commercialization of first-in-class small molecules for neuroregeneration, announced it has raised $30 million in a Series B financing led by new investor Sectoral Asset Management. Founding investor Versant Ventures also participated, and was joined by new investors Cleva Pharma Capital (a Brace Pharma affiliate), RBV Capital and Hadean Ventures.
Pipeline Therapeutics plans to use the proceeds to advance its portfolio of regenerative therapies that promote functional recovery in multiple neurological diseases.
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Cubic to launch first-of-its-kind loyalty-based
advertising service for transit agencies
Cubic Transportation Systems, the business division of Cubic Corporation, will launch an advertising and loyalty rewards platform for public transportation called Cubic Interactive.
Cubic Interactive allows brands to place advertisements within a transit agency’s mobile traveler app and/or physical assets such as gates and ticket vending machines, giving brands access to targeted, captive audiences based on a transit agency’s rich traveler demographic data. Ricola, one of the world’s most innovative manufacturers of herb cough drops and breath mints, is the first brand to advertise with Cubic Interactive.
By offering personalized ads within a transit agency’s mobile traveler app or through out-of-home ads, Cubic Interactive gives brands the opportunity to engage with audiences through channels that go beyond traditional mass retailer or national advertising – driving commerce, loyalty and brand awareness on the go. Travelers can engage with advertising content from brands and earn loyalty points.
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Kearny Mesa office building
sells for $23.75 million
Real estate investment firm IDS Real Estate Group purchased an office building in Kearny Mesa for $23.75 million from Massachusetts-based real estate investment trust Office Properties Income Trust.
Located at 4181 Ruffin Road, the 148,488-square-foot building was originally built in 1981 and renovated in 2013. The property was 83 percent leased at the time of sale to four tenants, including U.S. General Services Administration (GSA), a travel insurer and a technology company. The property has had a long history dating back to the 1990s with GSA tenancy, and the GSA was nearly half the occupancy at the time of sale.
CBRE’s Louay Alsadek, Hunter Rowe and Brad Black represented the seller.
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FTC challenges Illumina’s proposed
acquisition of Pacific Biosciences of California
The Federal Trade Commission is attempting to block Illumina Inc.’s proposed $1.2 billion acquisition of Pacific Biosciences of California. The commission alleges in an administrative complaint that Illumina is seeking to unlawfully maintain its monopoly in the U.S. market for next-generation DNA sequencing (NGS) systems by extinguishing PacBio as a nascent competitive threat.
The complaint also alleges that the proposed acquisition is illegal because it may substantially lessen competition in the U.S. NGS market by eliminating current competition and preventing future competition between Illumina and PacBio. The commission also authorized staff to seek a temporary restraining order and a preliminary injunction in federal court, if necessary, to maintain the status quo pending the administrative proceeding.
NGS is a rapidly expanding technology used in genetic research and clinical testing. Illumina is the world’s leading supplier of NGS products. Illumina’s systems employ short-read sequencing technology, which has been the predominant NGS technology in the United States for the last decade. PacBio is one of three other companies that manufactures and sells NGS systems in the U.S. market, according to the complaint. PacBio’s platforms employ long-read sequencing technology, an important tool that PacBio pioneered and that has improved significantly over time.
