Yashar Niknafs: U-M alum launches startup, pivots from prostate diagnostics to COVID-19 testing

June 16, 2020
Contact: Jeff Karoub jkaroub@umich.edu

COVID-19 virus cells. Image credit: iStockYashar Niknafs, CEO of a newly launched University of Michigan startup company, had a promising prostate cancer test he helped develop while a Ph.D. student in the Michigan Center for Translational Pathology. He and his startup, LynxDx, also had investors, a commercial lab and a small team ready to ramp up.

Then, pandemic struck, and the work ground to a halt.

Yashar Niknafs

Yashar Niknafs

Rather than lay low and ride it out, Niknafs and his team at LynxDx realized they had the tools, talent and capacity to pivot to COVID-19 testing and help address a growing public health need. They are now helping get more people tested, more quickly. Niknafs discusses what he has learned making the switch, how investors feel about the pivot and what it means to innovate—and coordinate—on the front lines of a global health crisis.

What is the LynxDx origin story?

We spun out of University of Michigan. Prostate cancer diagnostics is our main focus—we have a urine diagnostic test and intellectual property was developed in Dr. Arul Chinnaiyan‘s research lab. Now we’re commercializing the technology.

I got my Ph.D. in the lab where the tech was developed. I opted to not return to medical school and instead get into entrepreneurship. I started the company with my Ph.D. mentor and have been leading the charge for almost two years.

We ramped up to do clinical testing for the urine assay and the pandemic hit. We’re fortunate the infrastructure of the lab and the tech used for the prostate cancer assay has significant overlap with COVID testing. At the time, we felt a call to arms and just mobilized the team to start repurposing the lab and get COVID testing up and running.

Were you concerned about switching gears so early in the company’s development?

At the time of this decision, we had been mainly focusing on a lot of backend R&D work for the prostate test. There was a lot of work on dealing with Medicare, insurance companies to get reimbursement for the test. We had acquired lab space about nine months ago. We had our lab and we were slowly starting to build it out. We purchased the instrumentation and we were at the brink of getting Clinical Laboratory Improvement Amendments (CLIA) certified to run commercial samples.

At the time of the pandemic, we had maybe three or four people, a pretty small operation. Obviously, this pivot to COVID testing has been a large capital investment and it’s definitely going to eat into our initial fundraising round. So, there was that concern. We really did feel passionate about this, so I think we were willing to incur that risk. And we’re fortunate that our investors probably would replenish us if needed.

Over the past few weeks, we’ve hired multiple techs, technical leads and support staff for the COVID assay. It was a mad dash; it was all hands on deck. We were very lucky to have a solid team from the beginning. We were working nonstop. But we were planning and intended to be a commercial laboratory. That’s something that was able to set us apart. Early on, there were a lot of articles that I saw coming out about a lot of academic labs wanting to repurpose for COVID but not having that commercial infrastructure. We already had the CLIA lab director. We had already begun to put a lot of the documentation together. All of the procedures and instruments were managed with CLIA in mind.

We were able to rapidly accelerate this process. Initially with the prostate test, we were going at a slower pace. We’d do it with fewer personnel, and we anticipated being ready by late summer or early fall. We went from our three-month time estimate to three weeks. Here we are today, fully certified end-to-end. We can run these commercial samples. We blew up pretty fast.

Can you talk about where you are right now with respect to the COVID tests and where you aim to be?

We were able to partner with a medical staffing company based in Lansing. We have a drive-thru site, where anyone in the public can get tested. That’s kind of the backbone, where we can get our first batch of clinical samples. We really were passionate about servicing places where there is high need and low supply like nursing homes, long-term care facilities. So as the pandemic was spreading there were many articles about how those facilities were just getting ravaged by COVID. So, we partnered with the medical staffing agency to get our own nurses on the team so that we could send them to nursing homes or employers. That became the pivot and the focus of what we wanted to do.

It was very interesting to see how difficult it actually was to find sources of samples. We’re ready, we’re up and running. By anyone’s estimate, there was a shortage of testing capacity in the country. You’d imagine a testing site goes live and we can do hundreds of samples a day, we should just be getting samples. We discovered early on there was no centralized effort to connect demand with supply at all. Other countries have done this. This was not the case. We were just doing our own outreach. Ani Shirvanian, our clinical liaison, probably called hundreds of individuals, health departments, nursing homes, employers. We’ve had to do our own personal outreach. Finally and fortunately, we got connected with the Michigan Department of Health and Human Services. We’ve been put on a rural testing task force. We are now being deployed to do baseline testing at nursing homes and long-term care facilities in northern Michigan.

What else did you learn about COVID testing?

A lot of places are still citing a 5-to-7-day turnaround. In a lot of cases, samples are getting sent to these big-box diagnostics firms because of existing relationships.
The actual assay does not take that long. It takes 3-4 hours. Everyone is using the same tech. We don’t have special technology that makes our turnaround faster. Our turnaround is faster because we’re not taking in more tests than we can do every day.

Also, it’s fairly easy to send a box of masks to Hospital X and another to Hospital Y. There are a lot of places where testing gets complicated: Who collects the tests, how do you handle the collection and how are the results reported?

Getting back to the investors, how do they feel about the pivot and what is your funding picture?

Generally, I think we have been receiving support and I think that’s largely because we’re functioning. Our company has actually grown. From a business standpoint, this has been a positive thing for us.

What has been interesting is to see how the total investor landscape has changed. We’ve had a couple prospective investors we were talking to and they were like, “We as an investment firm haven’t decided what we’re going to do with COVID, so circle back to us when you’re getting back to prostate stuff.” There’s so much uncertainty in the VC space, they don’t know what to do with COVID tech. A lot of investors are keeping their pocketbooks a little more closed.

We applied for a Small Business Innovation Research grant. The National Institutes of Health has a program to fund startups doing tech in line with areas of focus for the NIH, so we applied to the National Cancer Institute with our prostate assay. It would provide about $2.13 million over two years for research. We received an intent-to-fund letter in April and hope to get an official decision on June 15. If that funding indeed comes through, I will be able to sleep well at night knowing that even if angel investors and VCs stopped investing, we will have that cushion to push us forward.

Also, in the last few weeks, the NIH has formed a funding body for COVID research specifically. We’re putting together a grant right now on some tech we’re developing with a partner group. They seek novel technology that can increase testing capacity and throughput with a clear commercialization path with the goal of massively increasing capacity by the end of summer.

Have you learned anything that could reinvigorate your original mission?

I think this experience has shown me and us what it’s actually like to be on the front lines and impact patient care.

When I started my Ph.D., it was super abstract: I’m just writing lines of code. My lab, our group, is called the Michigan Center for Translational Pathology. The mission is always to translate the work, but it starts off very much as a concept. As I finished my Ph.D., it got a little more real. I can see how this went from “I discovered a biomarker to I can get this biomarker into the clinic.” Then, we started the company and we got the university technology license. The prostate cancer test is being run, patients have used this urine test. But when you have COVID, there are clear places where you can see how our tests could change how things are done and could really save lives: If you’re in a nursing home and you detect one person on the staff has it and that person goes home and doesn’t come back for two weeks, you could prevent 200 people from getting COVID. That was really something that put a fire in me. For the first time I said, “Yeah, this work can actually impact real lives.”

My realization was if you don’t commercialize, nothing ends up in the patients’ hands. It’s been cool to experience this first-hand. The University of Michigan has an incredible Office of Tech Transfer. The university buys into the idea that commercialization is needed.