Biotechnology startup Aprea, a spinout of Karolinska Institute that is backed by a range of public investors, has raised the biggest round for a Sweden-based life sciences company in a decade.

Aprea, a biotech spinout of Sweden’s Karolinska Institute working on cancer treatments, raised Skr437m ($51m) last week, making it the largest funding round secured by a Karolinska Development portfolio company to date.

The deal, which is also the biggest funding round raised by any Sweden-based life sciences company in the past decade, was co-led by VC firms Versant Ventures and 5AM Ventures and also featured Sectoral Asset Management and HealthCap.

Karolinska Development, the investment arm of Karolinska Institute, participated in the round through the conversion of Skr60m in outstanding loans.

Karolinska Development now holds a 19% stake in Aprea, directly and indirectly through KDev Investments, co-owned with Rosetta Capital, and KCIF Co-Investment Fund, co-owned with the European Investment Fund.

The size of Karolinska’s share is a significant dilution from the 68.6% and 7.5% stakes that KDev and KCIF held respectively before the funding round, according to Aprea’s website.

Founded in 2003, Aprea is working on an anti-cancer therapy that reactivates proper functioning of a protein named p53, an important part of the body’s ability to suppress cancer cells.

The gene responsible for encoding the protein is the most commonly mutated cancer gene, being present in about half of all human tumours. The mutation is often linked with resistance to existing cancer therapies and poor survival rates.

The company’s lead drug candidate, APR-246, is in clinical development, and Aprea presented preliminary results of a phase 1b trial for patients with ovarian cancer in October 2015, when Mikael von Euler, chief medical officer, said: “While we are careful not to draw definite conclusions from these preliminary results, we are encouraged by the data indicating that APR-246 has the potential to improve treatment for ovarian cancer patients.”

Aprea will use the fresh capital to advance the development of APR-246 and plans to conduct clinical trials for additional cancer indications in the near future. The company also hopes to expand into the US.

The therapy is based on research by Klas Wiman and his colleagues Galina Selivanova and Vladimir Bykov, who discovered how to repair a defective p53 in 2000. The researchers then screened more than 100 compounds before developing APR-246 in 2006.

Last week, we also reported on the launch of Z53 Therapeutics, based on research conducted at Rutgers University and State University of New York’s Health Science Centre at Syracuse, which is taking a similar approach.

Jim Van heusden told publication FierceBiotech that the series B deal was “a very important milestone because the way Karolinska Development was working before was doing everything by themselves and being the only majority shareholder”.

Van heusden took over the reins at Karolinska Development in March 2015 and since then has worked to attract other investors to its portfolio companies. He continued: “Investing in life sciences is long term, high risk [and] capital intensive. So, it is better to share that risk with other experienced investors.”

Karolinska’s shares indeed rose by more than 9%, though they are still approximately 80% below the IPO pricing in 2011, a downward spiral that Van heusden is keen on stopping. He seems to be making some important first steps to achieving that.

Van heusden plans to secure follow-on funding for existing portfolio businesses through third-party investors while Karolinska Development will use its own resources to seek out new opportunities.

He said: “We are extremely happy that we were able to close this deal with a syndicate of top-tier international venture capital life sciences investors. The deal underscores the value of our more focused portfolio approach and provides Aprea with the necessary funding to reach its next major value inflection point.”

Aprea has not disclosed details about its series A round, though we reported in 2013 that the spinout was one of 13 Karolinska portfolio companies to have obtained part of a $40m investment made by angel network B-to-V Partners and Rosetta Capital.

Aprea’s remaining shareholders include Östersjöstiftelsen, the Foundation for Baltic and East European Studies set up by Sweden’s government in 1994, and Praktikerinvest, the investment vehicle of private health and dental care provider Praktikerjänst, which both invested in 2005. Industrifonden, the venture capital arm of Sweden’s government, joined Aprea’s shareholders in 2007.

– This article was first published on our sister site Global University Venturing.