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Since innovation is the key to economic growth, some governments, industry, and the private sector worldwide have rallied to help spur, fund and support innovative early-stage life science companies.
In the last month or so, it was announced that 14 new Venture companies/new funds and two new innovation centers have formed in various countries to spur innovation locally and worldwide.
The following new venture companies/new funds are:
1) RusNano, of Russia has formed a partnership with Domain Associates, of the US and has designated $760 million to invest in about 20 life sciences companies and build a pharma manufacturing center in Russia to produce next-generation therapies.
RusNano's mission is to "Investing in emerging life sciences companies, spurring the transfer of technology to Russia and creating exclusive ties with developing companies which will foster the growth of the country's biopharma industry."
In addition, the Russia Venture Capital, a government fund, and Maxwell Asset Management of Russian have opened an office in Boston with $100 million dedicated to life science companies.
2) Bessemer Venture Partners (BVP) and the Skolkovo Foundation announced a memorandum of understanding (MOU) in which BVP will set a USD 20 million target for investments into Skolkovo resident companies over the next two years. Skolkovo is a non-profit agency formed in May 2010 to provide funding to high tech companies after seed and series A rounds.
The key focus for the Skolkovo Foundation, a development agency is to bridge the gap between seed rounds and series A rounds for high-tech companies including high-tech related to medical coming from Russia -- and partnerships such as this one are essential for achieving this goal. With this partnership, Skolkovo now partners with more than 30 Russian and international venture companies.
In return, BVP will receive priority access to the Skolkovo Foundation project pipeline, can select the most promising projects to invest in and BVP will have the opportunity to refer its existing portfolio companies to receive Skolkovo Foundation support.
3) Sir Chris Evans, biotech investor has gained commitment from the Welsh government to invest £50 million in a new life sciences fund. Sir Evans will find investors to match this fund. "Their goal is to create a biotech hub that can attract venture cash from outside the region and spin out new companies, creating an engine for economic growth. And Evans sees a day when the fund can earn back more money that can continue to be invested in the field."
Sir Evans states that there is a lot of work and collaboration to be done in building a world class biotech hub that will attract investors and talent to this region. But he believes it can be done.
4) Sofinnova Ventures, a US biotech VC firm is opening an office in Ireland to look for local talent and innovation. Sofinnova is backed by Enterprise Ireland and a local pension group with $37.5 million. This deal is a win-win for everyone. Sofinnova was able to raise $440 million in new funding focusing almost exclusively on drug development and Ireland has an experienced venture player to foster local talent and connections to the VC group's international biotech industry.
"Developing a dynamic venture capital industry in Ireland is a key part of this Government's growth strategy. Venture capital funds provide crucial funding, as well as mentoring and advice, to early-stage high-potential companies in key high-growth sectors," noted Richard Bruton, the government minister for jobs and enterprise.
5) Versant Ventures, a $1.6 billion Silicon Valley-based life sciences fund, has opened a new office in Basel, Switzerland, looking to make new seed and early stage biotech and medical device investments. According to a company video, Brad Bolzen, managing director, said the reason Versant picked Switzerland is because European entrepreneurs were more willing to take risk similar to US entrepreneurs and started to form biotech sectors. It is also a tight knit business community that fosters doing business there.
6) The Wellcome Trust, a UK-based foundation is creating a £200m fund for long-term investments in start-up biotechnology companies. Wellcome Trust is one of the largest philanthropic funders of scientific and medical research in the world, and as part of the terms of the investment they will take significant equity share and exert management influence in companies with promising projects.
The new company, temporarily called Sigma, will focus on UK and European companies and use the resources of Wellcome's extensive network of experts and the scientific projects it funds. The company is focusing on "transformational technologies" with potential for high returns in long-term investments.
7) The Cancer Research UK has partnered with the European Investment Fund to launch a 25 million of a planned 80 million euro fund specifically to help developers bridge the gap between preclinical work and mid-stage studies. The fund called the CRT Pioneer Fund, will support scientists who are taking cancer drugs from discovery on to the threshold of Phase II studies--a segment that's been avoided by many classic venture groups. Majority of the cash will be reserved for cancer treatments studied by Cancer Research UK scientists.
"This important investment means we can take forward the most innovative approaches using our in-house drug discovery and development capabilities, to progress promising treatments from the lab all the way to clinical trials, translating our world-class scientific research into new treatments more quickly," said Keith Blundy, CEO of Cancer Research Technology.
8) U.K. officials with the support of Prime Minister David Cameron, who's become a champion of the life sciences sector, are preparing to launch a $286 million fund called Biomedical Catalyst that will be operated by the Medical Research Council and the Technology Strategy Board. "The U.K. boasts a world-leading life sciences sector which is changing at an incredible pace," says Cameron. "And I'm absolutely committed to helping it widen its significant foothold in the global market," said Prime Minister Cameron according to FierceBiotech.
The new fund will support small- and medium-sized companies as well as academics in preclinical or clinical development. Companies can qualify for £150,000 feasibility awards to £3 million for early- and late-stage awards. The focus will be on drug development, diagnostics, medical devices, and other technologies in the field.
9) GlaxoSmithKline and Johnson & Johnson has partnered with Index Ventures in forming a €150m investment fund designed to accelerate successful drug discovery. The new fund will invest only in early-stage, single-asset companies. Index Ventures contributing €75m to the fund will use an "asset-centric investment" approach to support experimental medicines rather than fledgling companies. Their approach is to use their network of experts both in drug development and business to develop any promising experimental medicines they find. Because Index is using outside experts, these experts will have no ties to any particular project and will advance forward or abandon potential drugs as quickly as possible.
The aim is to invest in 10 to 20 companies developing a maximum of 15 to 30 "first-in-class" or "best-in-class" molecules to treat a range of diseases, primarily in Europe. Moncef Slaoui, GSK's chairman of R&D, said: "It's very important for us to find alternative strategies to access innovation. Index has a very attractive model."
10) Merck Canada, a subsidiary of US Merck is committing to a $100 million Canadian dollars ($99.7 million) fund with Lumina Capital and others with the purpose of drawing more pharmaceutical companies to Quebec, according the Winnipeg Free Press. The fund will support early stage companies. Quebec Economic Development Minister Sam Hamada is expected to participate in the announcement Monday, but the provincial government isn't immediately providing funding, sources said.
11) Karen Pritzker, member of the famed Pritzker family that created the Hyatt hotel chain formed a trust, KLP Enterprises to invest in start-ups. Alopexx Enterprises, a subsidiary of KLP formed in 2011 offers startups assistance in drug development, manufacturing, and regulatory affairs. This trust recently invested $20 million, Series A in 4s3 Bioscience, a Medford, MA-based company that developed drug delivery technology for treating muscle disorders.
12) Access BridgeGap Ventures, a new life sciences venture initiative was formed by Access Industries to fund early-stage companies in the therapeutics space. Access BridgeGap will fund early-stage startups and focus on scientists, entrepreneurs, and companies that are developing novel and clinically relevant therapeutic approaches and platforms that can become must-have solutions for patients, physicians, and payers. The group is led by Daniel Behr, MBA, and Ben Bronstein, MD, both recognized serial entrepreneurs and technology developers.
According to Daniel Behr, Founder, and Senior Vice President, "With Access' support we have the resources and flexibility to span all investment stages and build fully independent companies, either alone or with other investors. Access BridgeGap expects to fund 3-5 companies per year and to deploy $75M over the first few years," according to an article by thestreet.com.
13) Flagship Ventures of Cambridge, MA plans to co-launch therapeutics startups with Merck Research Labs, according to the Boston Biz Journal. Merck made an undisclosed investment in Flagship's newest $270 million fund. The deal allows Merck the option of buying a startup that result from the partnership, but there are no exclusive deals.
Usually pharma and biotech transact, rather than interact," Flagship co-founder and CEO Noubar Afeyan said. "But if you look at how innovation happens, it's about sharing ideas." Merck wants to get close to where innovation happens, Afeyan said, because it will give the giant drug maker a competitive advantage down the line.
14) H.I.G. BioVentures, a Miami-based venture firm with ties to Maryland's biotech cluster, raised a fresh $268 million to invest in drug, medical device, and diagnostics companies.
H.I.G. plans to be essentially agnostic when it comes to the stage of their investments. For drug developers, they'll look at portfolios ranging from preclinical to mid-stage trials. For device makers, the team plans to invest from the early clinical stages all the way through commercial, Robertson said. They focus on markets outside of the life sciences hubs of Boston and the San Francisco Bay area, in what Robertson refers to as "secondary geographies" that includes Maryland. "We want to see everything we can see in all regions, but certainly here locally," Robertson said. "So we certainly encourage entrepreneurs to reach out to us," according to the Washington Biz Journal.
The two new innovation centers are:
1) Cleveland's University Hospital has launched a new $250 million project called The Harrington Project for Discovery & Development to advance drug candidates through the period from late animal testing to mid-clinical development in which companies find it difficult to raise funding to keep the drug development process going. They are claiming their project could become a national model for developing promising drugs and bringing them to market. The project is named after Ron and Nancy Harrington, whose $50 million donation will support the initiative.
The new model has two major components: "The first is a program called Harrington Scholars that will provide funding, support and mentorship to physician-scientists from around the country who are in the midst of developing promising drugs that would typically be abandoned by the private market. The second is a for-profit company that's designed to move drugs forward through the commercialization process," Stamler said.
2) Officials at UC San Diego are seeking to build a new "Center for Innovative Therapeutics" that would serve as a hub for a variety of academic research collaborations, as well as an incubator for accelerating private life sciences startups.
University officials announced their proposal for the first time at an annual cancer symposium at the UC San Diego Moores Cancer Center. Their plans for the project, which carries an estimated $110 million price tag, will be presented to the University of California Regents in May.
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