If there are any worries about the future of biotech, don't tell the venture capitalists.
Last week, biotechnology firms raised $758 million from VCs and angel investors, according to an analysis by Pitchbook, a data provider that tracks venture and private equity investments. In the year-to-date, venture capitalists have poured $2.8 billion into biotechnology startups. That means that in the first two months of 2018, venture capitalists have invested more in biotechnology firms than they did in all of any year before 2014.
And that may be an underestimate: the PitchBook list does not yet include Gelesis, which announced a $30 million fundraise last week, or health tech companies like Nomad Health (raised $12 million) or Woebot (raised $8 million).
It's not that there are that many more deals. Instead, investors are putting up much larger sums of money. They are pouring hundreds of millions of dollars into companies long before they are due to sell stock on public markets. In 2013, the VC community spread $2.4 billion among 287 companies. The $2.8 billion spent in two months of 2018 went to just 60 start-up firms.
| US Biotech Venture Capital Deals, February 26 Through March 2 | |||
| Company Name | Close Date | Deal Size ($M) | Investor(s) |
| Neurona Therapeutics | 02/26/18 | $10.04 | |
| Juvena Therapeutics | 02/26/18 | $4.32 | |
| Quentis Therapeutics | 02/27/18 | $48.00 | New York Ventures, Taiho Pharmaceutical Company, Yonghua Capital, AbbVie Ventures, Alexandria Venture Investments, Versant Venture Management, Polaris Partners |
| Senti Bio | 02/27/18 | $53.00 | Lifeforce Capital, Nest.Bio Ventures, 8VC, Menlo Ventures, Lux Capital, Amgen Ventures, Allen & Company, Omega Fund Management, New Enterprise Associates, Pear, Goodman Capital |
| Inscripta | 02/28/18 | $55.50 | Paladin Capital Group, Foresite Capital Management, NanoDimension, Xeraya Capital, Venrock, Mérieux Développement, Spruce Capital Partners |
| Viela Bio | 02/28/18 | $250.00 | Temasek Holdings, 6 Dimensions Capital, Sirona Capital, Hillhouse Capital Group, Boyu Capital Advisory Company |
| Rubius Therapeutics | 03/01/18 | $101.20 | Flagship Pioneering |
| Finch Therapeutics | 03/01/18 | $36.00 | Morgan Noble Healthcare Partners, Shumway Capital Partners, Avenir Growth Capital, Willett Advisors |
| Helix | 03/01/18 | $200.00 | DFJ Growth, Mayo Clinic Ventures, Warburg Pincus, Sutter Hill Ventures, Kleiner Perkins Caufield & Byers, Illumina |
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Source: Pitchbook |
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Last week was no different. The average investment was $84 million, with three companies raising more than $100 million. Helix, a competitor to 23andMe and Ancestry in consumer genetics, raised $200 million ($50 million less, it's worth noting, than 23andMe raised in September). Viela Bio, an AstraZeneca spinout, raised $250 million. Rubius, a cell therapy chaired by former Novartis pharmaceuticals executive David Epstein that focuses on turning red blood cells into drugs, raised $100 million despite not having started human tests.
And, as a consequence, these companies are now more valuable than privately held firms have ever been. A company is literally worth the sum of the price of all its shares. For public firms, this figure is the market capitalization. For private firms, the number can be fuzzier, with investors cutting special deals in which some shares are worth more than others, thereby inflating valuations. I...
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