Venture capital firms are vital when it comes to helping biotech startups reach new heights, providing both financial and operational support. Some household names in the industry include the likes of Third Rock Ventures, Sofinnova and OrbiMed. These companies were solely designed to operate as venture capital firms but, over the years, many big pharma and biotech companies have also decided to spin out their own venture capital funds in an effort to scout and invest early in potential acquisitions. In this article, we delve deeper into the work of 10 notable pharma and biotech venture capital arms.
Having been investing since 2009, AbbVie Ventures is AbbVie’s corporate strategic venture capital arm that focuses exclusively on novel, transformational therapeutics at discovery and pre-clinical stages. Aligning with AbbVie’s R&D interests, AbbVie Ventures’ investments address critical needs in oncology, immunology, neuroscience, eye care, and aesthetics.
The venture capital arm offers its partners access to the big pharma’s internal network of experts in all phases of drug development, from drug discovery through successful commercialization. Targeting six to eight new investments annually, predominantly at the seed or series A stage, its current portfolio is comprised of 20 companies based in the U.S. and Europe, including the likes of Capsida Biotherapeutics, which is creating a new class of targeted gene therapies for both central nervous system (CNS) and non-CNS disorders, Umoja Biopharma, which is pioneering the future of immunotherapy by reprogramming T cells in vivo, and small molecule inhibitor oncology company Ribbon Therapeutics.
Part of Japanese multinational pharma company Astellas, Astellas Venture Management is a venture capital fund dedicated to supporting pre-clinical, cutting-edge science that can bring value to patients. For more than 15 years, the venture capital arm has provided equity investments to private, early-stage companies developing therapeutic programs and platform technologies, helping them to advance their innovations faster. As a strategic investor, it invests in science that will enhance the current Astellas R&D pipeline or that could create new directions in discovery research.
Since 2020, Astellas Venture Management has invested in around 15 companies, including circular RNA-based cell engineering company Orna Therapeutics, gene therapy company Carbon Biosciences, and NeoPhore, which raised $12.2 million in series B financing in February with participation from Astellas Venture Management. Meanwhile, prior to 2020, Astellas Venture Management also made investments in companies such as U.K.-based oncology company Bicycle Therapeutics and fellow Japanese company Heartseed.
JJDC is the venture capital arm of big pharma Johnson & Johnson that invests across the pharmaceuticals and medtech sectors at all stages, from new company creation and seed-level startups to series A and beyond, including private investments in public equity (PIPEs). With more than 100 portfolio companies, it deploys the full capabilities of the Johnson & Johnson Family of Companies for the companies it invests in, including discovery, clinical development, regulatory affairs, manufacturing and commercialization.
Last year marked 50 years of corporate venture investing for JJDC. There were also plenty of milestone investments made by the company last year, including a strategic investment in Rome Therapeutics to support clinical development for autoimmune diseases, and a PIPE investment in Nanobiotix, a clinical-stage biotechnology company focused on developing product candidates using proprietary nanotechnology to increase the efficacy of radiotherapy in oncology. Plus, precision neuromedicine company Rapport Therapeutics was spun out of JJDC (as well as Third Rock Ventures and ARCH) in March 2023 with a $100 million financing round.
A part of German pharma company Bayer, Leaps by Bayer says it is spearheading a movement to make paradigm-shifting advances in the life sciences by targeting the breakthroughs that could fundamentally change the world for the better. Across healthcare and agriculture, the venture capital arm of this big pharma is aiming to conquer ten huge challenges, which it refers to as the ’10 Leaps’, facing humanity, such as reducing the environmental impact of agriculture or curing genetic diseases. It is these ’10 Leaps’ that build the framework for Leaps by Bayer’s impact investment strategy.
Partnering with companies in biotech, health-tech and ag-tech, Leaps by Bayer invests either in existing companies or co-creating new ventures, providing significant early-stage funding and access to the Bayer network’s technical capabilities. Since 2015, it has invested over $1.7 billion in more than 55 ventures working on what it calls ‘disruptive innovations’. In the agricultural sector, these companies tackle fundamental breakthroughs to drive next-generation agriculture technologies that provide solutions to sustainably meet the demands of our growing population, while in the healthcare sector, the ultimate goal of these investments is to move from treatment to prevention and cure, addressing some of the most devastating diseases.
Although in this case, the name might not give away much of a clue, M Ventures is actually the venture capital arm of pharma Merck KGaA. Investing in biotechnology and technology, M Ventures covers the areas of healthcare drug development, life science tools, electronics and frontier technology, and sustainability. Ultimately, it invests in visionary companies that are aiming to find new ways to treat the most challenging diseases, empower scientists with cutting-edge research and development tools, develop new solutions that change the way in which information is accessed, stored, processed, and displayed, and address some of the most complex challenges in sustainability and technology convergence.
Focusing specifically on M Ventures’ biotechnology portfolio, it has invested in around 50 companies. Examples of these companies include the likes of drug discovery firm LabGenius, which recently raised £35 million ($44 million) in a round led by M Ventures, oncolytic viral therapy company Theolytics, which also recently raised $24.5 million in a round that involved participation from M Ventures, and DISCO Pharmaceuticals, an oncology company that launched in January with €20 million ($22 million) in seed financing and backing from both M Ventures and AbbVie Ventures.
Novartis Venture Fund is a part of Swiss multinational Novartis. It manages more than $750 million in committed capital and has more than 40 portfolio companies across North America and Europe. These companies include in vivo cell reprogramming company Capstan Therapeutics, which launched in 2022 with $165 million in capital, and AstronauTx, which focuses on neurodegenerative diseases and recently closed a $61 million series A round that was led by the Novartis Venture Fund.
The fund was created to foster innovation, drive significant patient benefit, and generate superior returns by nurturing and investing in innovative life science companies. Although it looks at investing in both early-stage startups or a later-stage companies, it does say that it primarily focuses on seed or series A stage companies, and specializes in investments ranging from $5 to $10 million.
Novo Holdings is a holding and investment company that is responsible for managing the assets and wealth of the Novo Nordisk Foundation, and is therefore, the controlling shareholder of Novo Nordisk and Novozymes (the Novo Group companies). It manages an investment portfolio with a long-term return perspective and is focused on investing in life science companies at all stages of development, as well as managing a broad portfolio of equities, bonds, real estate and infrastructure assets, plus private equity investments. As of the end of 2023, the company had total assets under management of €149 billion, with 170 portfolio companies.
Novo Holdings invests in almost all life science sectors, including biotech, pharmaceuticals, medtech, healthcare services, and industrial biosolutions. Its portfolio in this area includes private and publicly held companies at all stages of development. Some of its most recent investment activities include co-leading a $103 million series A financing in Reunion Neurosciences to develop serotonergic psychedelic therapies for underserved mental health conditions, committing €188 million ($203 million) to build a quantum technology startup ecosystem in Denmark, and leading a €6 million ($6.5 million) financing for REDUCED, a Copenhagen-based company that uses fermentation technology to transform food and agriculture industry side streams into natural food ingredients.
Pfizer Ventures invests in areas of current or future strategic interest to Pfizer with the goal of remaining at the forefront of life science advances, identifying and investing in emerging companies that are developing transformative medicines and technologies that have the potential to enhance Pfizer’s pipeline and shape the future of the biopharma industry.
The venture capital arm of this big pharma has a $900M capital commitment for investment and backs private companies at all stages of development. However, it has a strong focus on early-stage opportunities. It also primarily focuses on U.S. investments and has invested in companies such as the previously mentioned Capstan Therapeutics, as well as genetic medicine company ReCode Therapeutics, and Therachon, which Pfizer went on to acquire in 2019. International investments do also make up 20% of Pfizer Ventures’ portfolio, and includes companies like U.K.-based oncology company Artios Pharma and deubiquitinylase enzymes (DUB) company Mission Therapeutics.
Just last month, Regeneron Pharmaceuticals launched its new capital arm, Regeneron Ventures, with a $500 million commitment to fuel promising biotech innovation and help portfolio companies turn great ideas into promising products that can change patients’ lives. The fund is specifically focused on promising biopharmaceutical, healthcare and health technology companies.
In the press release revealing the launch of Regeneron Ventures, it said that it bases its investment decisions on the quality of the people, science, and data, it likes breakthrough innovation, it tolerates risk and uncertainty, and it is open-minded, doubting and questioning, but also recognizing that companies are idiosyncratic, if not unique, and should follow their own path.
Sanofi Ventures serves as an entry point to the innovation ecosystem for Sanofi, as it strategically invests in early-stage transformational science and technology, when companies are too early to partner with or acquire. It specifically invests in top-tier biotech and digital health companies that focus on helping patients and transforming the practice of medicine, and invests across all stages of the private company lifecycle, from seed to series B and beyond, while leading financings, serving on boards, and taking pride in working alongside portfolio companies to drive long-term value.
The pharma’s venture capital arm has invested in the likes of well-known gene therapy company bluebird bio, next-generation precision medicine company Mirador Therapeutics, and QurAlis, which aims to treat amyotrophic lateral sclerosis (ALS) and other neurodegenerative diseases through the development of next-generation precision medicines to genetically validated targets.
The list above includes just a handful of pharma and biotech companies that are involved in investing in the industry. Other notable mentions, for example, include Amgen, Bristol Myers Squibb, and Eli Lilly. The big pharma’s venture capital arm is called Amgen Ventures, which was formed in 2004, and was designed to provide resources to help advance early-stage biotech companies and human therapeutics. Bristol Myers Squibb also regularly participates in investment rounds. Just recently, for example, it was involved in Accent Therapeutics’ $75 million round. Meanwhile, last year, Eli Lilly allocated an additional $50 million to its $300 million Social Impact Venture Capital Portfolio, which has indirectly funded more than 50 U.S.-based start-ups. The additional $50 million announced last year will go towards venture capital firms that specialize in near- and long-term healthcare solutions for patients in low- and middle-income countries.
