Corporate venture capital (CVC) has long been an important source of capital for early-stage biotechs and shows no signs of diminishing, with more and more biopharma companies stepping up their investment activity.
According to a new report from EP Vantage, Pfizer, Celgene and Roche are among drugmakers whose strategic venture arms are becoming increasingly visible, picking up the pace and gaining on the longstanding leaders such as Novartis, Johnson & Johnson and GlaxoSmithKline's SR One unit.
The largest recipients of this CVC cash are oncology companies—no surprises there—as well as medical device, central nervous system disease and anti-infectives players, it said.
Pfizer's rise up the ranking is particularly remarkable, as its Pfizer Venture Investments (PVI) unit overtook Novartis last year with 16 funding rounds, and now has upwards of 50 biotechs in its current portfolio. Since last year it signed 18 companies including most recent additions Complexa, Effector Therapeutics and Cordex Systems, according to Crunchbase.
EP Vantage's ranking of most active life science investors puts Novartis Venture Funds (NVF) at the top of the tree among big biopharma companies, with 161 deals between 2007 and 2016. That puts it at number three behind investment funds New Enterprise Associates and Orbimed Advisors. It’s also added a swath of new deals this year, including investments in Effector Therapeutics, NeuroVia and E-scape Bio in July alone.
“The dominance of Novartis over the years is clear; with a broad focus on human therapeutics, medical devices and diagnostics, the Swiss group scours a bigger pool of potential startups than those companies with a more focused gaze,” said EP Vantage.
Novartis’ unit lies just ahead of Novo at position four, with 144 deals in the 2007-2016 timeframe, adding to its tally in June with a $13 million Series C round for research tools company Unchained Labs. With 99 and 91 deals respectively, J&J Development Corp and SR One lie just outside the top 10 at positions 11 and 12, with Lilly Ventures, PVI and Roche Venture Fund appearing in the 30s.
Celgene is worth highlighting as it made 11 investments last year despite not having a dedicated venture capital unit, said the report. That included contributions to a $220 million investment round for J. Craig Venter's genome outfit Human Longevity, plus funding for immune-oncology player Arcus Biosciences, oncolytic virus specialist Oncorus and antibody-drug conjugate (ADC) developer Zymeworks.