By Sara Castellanos 

Quantum computing startup Seeqc Inc. has raised more than $11 million in venture capital funding from investors including a subsidiary of German company Merck KGaA, which is interested in using the technology for materials science and pharmaceutical development.

M Ventures, the corporate venture arm of Merck, has invested $5 million in Elmsford, N.Y.-based Seeqc, betting that in several years, the startup's technology could save Merck time and money related to simulating drugs and chemicals. The Series A is expected to close later this spring, according to a Seeqc spokesperson.

"We think this technology will change the world of simulations for us if it proves to be scalable," said Philipp Harbach, head of in silico research at Merck.

Over the past two years, Merck has formed a quantum-computing task force of about 50 experts who are exploring use cases for a technology that could one day prove to be more powerful than traditional computers, including supercomputers.

Some experts say quantum computing could possibly be used by researchers combating the coronavirus pandemic to speed up certain calculations related to drug discovery and hospital logistics. However, neither Merck nor Seeqc have plans to use the technology for purposes related to the new coronavirus.

Instead, Merck is interested in experimenting with technology from Seeqc and other quantum computing-related vendors including Germany-based HQS Quantum Simulations to benefit materials science and drug discovery over the next several years, Mr. Harbach said.

Simulations of chemicals and pharmaceuticals, which Merck manufactures, are costly and time-consuming to complete using standard computers, even supercomputers. Validating the drugs in labs adds more time to a process that can take years. Predicting positive and negative effects of specific drugs, for example, is a computationally complex problem because it requires simulating the structure of molecules and their chemical features.

Quantum computing could potentially speed up drug and materials development, therefore cutting costs, Mr. Harbach said, because the technology has the potential to sort through a vast number of possibilities nearly instantaneously and come up with a probable solution. "If you can mimic a real-life experiment on a quantum computer, that could basically make things much faster in development, and of course much cheaper," Mr. Harbach said.

By 2023, about 20% of organizations, including businesses and governments, are expected to budget for quantum-computing projects, up from less than 1% in 2018, according to research and advisory firm Gartner Inc.

Founded in 2019, Seeqc is a spinout of Elmsford-based Hypres Inc., a developer of superconductor electronics. Aside from M Ventures, the startup's other investors include BlueYard Capital, Cambium, New Lab and the Partnership Fund for New York City.

There is currently no commercial-grade quantum computer on the market, but many companies are building quantum-computing systems using different technologies and architectures. They face engineering challenges that are making the road to market longer than planned.

Seeqc is building a quantum computing system using a so-called hybrid architecture that combines classical and quantum computing and is meant for very specific use cases, said John Levy, Seeqc's co-chief executive.

One of the benefits of the system is that it could reduce decoherence and therefore run an algorithm more reliably, Mr. Levy said. Decoherence refers to changes in temperature, noise, frequency and motion that can jostle quantum particles and hurt the accuracy of a calculation or prevent it from being completed.

The company is currently raising more money from investors and will use the funding to build a "toy-level" version of its quantum computer. "The idea is to deliver, within a three-year time horizon, an architecture that's built around a real-world problem and has the potential to scale, " Mr. Levy said.

Write to Sara Castellanos at sara.castellanos@wsj.com

 

(END) Dow Jones Newswires

April 09, 2020 13:59 ET (17:59 GMT)

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