- With the close of its latest fund, Atlas Venture now has $350 million more at its disposal to invest in early stage biotechs.
- The life sciences-focused venture capital firm on Thursday announced the closing of its eleventh fund, which was "highly oversubscribed," according to a statement. Atlas in the past has invested in Synlogic Inc., a developer of synthetic bacteria that recently merged with Mirna Therapeutics, and the RNA-targeting drugmaker Rana Therapeutics.
- The new fund is also the third Atlas has closed since 2012 and the fastest to complete in the last 15 years, according to a June 29 blog post from Atlas partner Bruce Booth.
A report from the financial data firm Pitchbook released back in April found that across U.S. markets, late-stage venture funding hasn't been accessible as of late.
The pharma and biotech sectors, however, are still receiving high levels of interest and investment. They were responsible for 13% of all stateside venture capital activity during the first quarter, or about $2 billion, according to Pitchbook.
Such a large number makes sense given the high-value funds different firms have completed in recent months. SV Health Investors and Pivotal bioVenture Partners raised $400 million and $300 million, respectively, to invest in young medical device and biotech companies. And back in October, Boston-based Third Rock Ventures closed its fourth fund, grabbing $616 million in the process.
The investments are noteworthy given some of the uncertainties surrounding the pharmaceutical sector, particularly with regard to issues like pricing turmoil and the Trump Administration's willingness to work with the industry.
In his blog post, Booth explained why investments continue to pour into his firm and into emerging biotechs.
"We avoid the conventional late stage product risks (e.g., regulatory, commercial, reimbursement risks), not to mention idiosyncratic Phase 3 event risk, by staying focused on early stage R&D," he wrote. "We do this by participating early in the bench-to-bedside translation process, derisking the story, and finding the right downstream partners to help address those potentially big ticket later stage issues (either Pharma or the public markets) that are hard to fund via venture diets."
"High innovation quotient startups are the key to driving this early interest from downstream partners," he added.
Booth also identified five "bullish macro tailwinds" that will continue to support the biotech industry, including a growing elderly population in need of innovative medicines, big pharmas further outsourcing their R&D requirements and a more friendly regulatory environment able to usher drugs to market faster.