Unable to raise funds, Carbon Nanoprobes to liquidate

Eighteen months ago, entrepreneur Brian Ruby was practically laughing in the face of the recession.

He’d just moved his company, Carbon Nanoprobes Inc., to Chester County from the Seattle area after landing an equity investment from the Life Sciences Greenhouse of Central Pennsylvania.

The space in East Whiteland Township had a clean room in which the nanotechnology company would make probes that researchers could use on the tip of an atomic microscope for molecular imaging.

That October, BusinessWeek named Ruby one of 25 finalists for its annual America’s Best Young Entrepreneurs feature. The magazine noted the company with nine employees was transitioning from research to equipment sales and expected $1 million in revenue in 2010.

Instead, Carbon Nanoprobes filed Dec. 30 to liquidate under Chapter 7 of the U.S. Bankruptcy Code. According to documents filed in federal Bankruptcy Court in Philadelphia, the company had assets of just $38,650 and liabilities of $1.59 million.

The largest creditor is the Harrisburg-based Life Sciences Greenhouse, which is owed $531,749. Michele Washko, vice president of strategic services for the greenhouse, said that her organization, which was seeded with some of Pennsylvania’s share of the national tobacco settlement, has written off the investment.

As unfortunate as that may be, it’s also to be expected when investing in start-ups pursuing novel technologies.

So what happened between the euphoria of June 2009 and now? In an e-mail, Ruby confirmed what Washko told me: Carbon Nanoprobes was a victim of a poor fund-raising environment.

Even though it had landed more than $4 million from institutional and angel investors, Carbon Nanoprobes needed a lot more.

“We had an aggressive capital-raising plan that was powering our projections,” Ruby wrote. “Because of the condition of the capital markets, that plan did not come to fruition.”

As for what’s next, Ruby, 26, would say only that he was weighing his options.

In Demand

Saladax Biomedical Inc., another of the Life Sciences Greenhouse’s investments, has fared much better.

The Bethlehem firm, which is developing medical-diagnostic products, raised $8 million from institutional investors last March. In June, Saladax signed a development agreement with the much-bigger Bristol-Myers Squibb Co. Now Saladax has hired a Philadelphia-area life-sciences entrepreneur as its president and chief executive officer.

Edward L. Erickson joined on Jan. 3 from a nanotechnology company based in the University City Science Center in West Philadelphia called BioNanomatrix Inc. Another local company Erickson ran was Immunicon Corp., which was acquired by Johnson & Johnson’s Veridex L.L.C. unit in 2008.