Recursion CEO Launches Pre-Seed Fund to Combat NIH Funding Cuts

In a bold move to address the impact of federal funding cuts on biotech innovation, Chris Gibson, CEO of Recursion Pharmaceuticals, has announced the launch of a new pre-seed fund through the company's biotechnology accelerator, Altitude Labs. This initiative aims to support early-stage life sciences researchers and startups affected by recent reductions in National Institutes of Health (NIH) funding.

New Fund Offers Lifeline to Early-Stage Biotechs

The newly established fund will provide grants ranging from $100,000 to $250,000, along with 12 months of lab and office space, to companies that have qualified for the federal Small Business Innovation Research (SBIR) program. This support is designed to fill the gap left by diminishing federal resources, which have been crucial for many startups in their early stages of development.

Gibson, reflecting on Recursion's own journey, stated, "Earning our early SBIRs was a pivotal moment for Recursion. The few million dollars that came in via the SBIR mechanism in our early years allowed us to build the fundamentals of our platform upon which we have now raised over $1 billion in private investment to turn Recursion into a $4 billion publicly traded company with eight therapeutics in clinical development."

Addressing the Impact of Federal Policy Changes

The Trump administration's policies have caused significant disruption within the scientific research community, particularly affecting academic laboratories that form the backbone of basic science research often licensed by biotechnology companies. Of particular concern are cuts to "indirect" funding provided by the NIH, which supports the overhead costs associated with federal research grants at academic institutions.

These federal grants, including those from the NIH, have long been a vital source of non-dilutive capital for young biotech companies, allowing them to fund essential operations without sacrificing equity. In 2023 alone, the NIH allocated nearly $1.3 billion in small business grants, underscoring the program's significance to the industry.

Altitude Labs: A Hub for Biotech Innovation

The new fund will operate under the umbrella of Altitude Labs, an accelerator founded by Gibson in 2020 in Salt Lake City. Gibson will lead the fund alongside David Bearss, co-founder of several therapeutics companies, and Chandana Haque, Altitude Lab's executive director.

Haque emphasized the urgency of their mission, stating, "Federal funding disruptions are stalling groundbreaking biotech research. With this fund, we are doing our small part to help secure the future of biotech innovation in America."

While the fund is open to applications from any SBIR-reviewed company, successful applicants will need to relocate to Salt Lake City to access the lab space and community resources offered by Altitude Labs. This requirement underscores the accelerator's commitment to fostering a collaborative ecosystem for biotech innovation.

Recursion's proactive response to the changing funding landscape stands out in an industry where many companies have remained publicly silent on the recent policy shifts affecting the NIH and Food and Drug Administration. As the biotechnology sector grapples with these challenges, initiatives like Altitude Labs' new fund may play a crucial role in sustaining the pipeline of innovative research and early-stage companies that drive the industry forward.