After 3 big exits, Lightstone snags largest fund yet with $375M geared toward next biotechs, medtechs

After seeing Ra Pharmaceuticals, Disarm Therapeutics and Tizona Therapeutics to exits last year, Lightstone Ventures is back with $375 million to plant a seed in early-stage biotech and medtech startups. 

That's the largest fund yet for the nine-year-old venture firm, which has used its pool of capital to fuel more than 30 upstarts in life sciences. The oversubscribed fund brings the firm's total raise since inception to $850 million after a $172 million fund in May 2014 and $250 million in September 2017.

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Lightstone's raise comes amid a banner year for biotech funding, on pace to set multiple records, and months after another high-profile incubator, Flagship Pioneering, snatched up $2.2 billion. Biopharmas in Boston, where many Lightstone employees call home, hauled in a whopping $4.3 billion in venture funding in the first quarter of this year.

Lightstone's fresh horde of capital will continue bankrolling biotech and medtech startups after a successful 2020 in which multiple portfolio companies were acquired. 

Eli Lilly paid $135 million upfront to acquire neurodegeneration biotech Disarm last October, and that figure could jump to about $1.2 billion based on certain marketing milestones. Lilly's bet came after Gilead Sciences dished out $300 million to buy a 49.9% equity interest in oncology biotech Tizona last July. Further yet, Lightstone portfolio biotech Ra was consumed by UCB for $2.3 billion in April 2020. 

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To help replicate past portfolio exits, Lightstone added two leaders to the team in conjunction with the Tuesday raise. Christina Isacson, Ph.D., joined as partner, and Young Kwon, Ph.D., was named operating partner.

Isacson helped found Magenta Therapeutics, where she was chief business officer, and prior to that was head of business development at Decibel Therapeutics, Edimer Pharmaceuticals and Ironwood Pharmaceuticals.

Kwon joined from Momenta Pharmaceuticals, where he spent a decade building up to chief financial and chief business officer until inking a $6.5 billion exit to Johnson & Johnson. Previously, Kwon was senior director of business development at Biogen.