It takes a planet: Woodford's investment strategy may help change the global biotech scene

Yesterday's announcement that London-based Cell Medica had raised a whopping $78 million to fund its work on T-cell therapies for cancer once again shoved fund manager Neil Woodford into the biotech spotlight. Woodford's fund joined the Cell Medica syndicate that's backing its work on immunotherapy, marking his second foray into biotech investing in a matter of days. The move closely followed his decision to take a sizable stake in Bethesda, MD-based Northwest Biotherapeutics ($NWBO), which is developing a controversial brain cancer drug.

A high-profile figure from his days at Invesco, Woodford has become a celebrity of sorts in the biopharma field in the U.K., which is largely clustered around London, Oxford and Cambridge. He mounted a loud campaign in favor of AstraZeneca when the British pharma giant was using a form of corporate jiu-jitsu to fend off a takeover attempt by Pfizer ($PFE). Woodford has also signaled his intention to start a second fund devoted entirely to biotech, which can only expand his already outsized presence in the industry.

In many ways, Woodford represents something that's desperately needed in the U.K. British scientists can hold their own with the best investigators at MIT, Harvard or Stanford. But biotech in the U.K. has been badly starved of cold, hard cash--and nothing eats up cash like advanced drug development. Woodford, who quickly assembled more than $5 billion for his own fund, promises to add $314 million to that with a second biotech fund.

But Woodford is also not a parochial player. Cell Medica and Northwest are both transatlantic biotechs. In Cell Medica's case, it has IP from Baylor in Texas, expertise in the U.K. and manufacturing in Germany. Maryland-based Northwest has been doing much of its research work in Europe, scoring the U.K.'s first designation as a "Promising Innovative Medicine" that can earn fast-track review status. And one of his first biotech investments with the new fund was with Prothena, the Dublin-based Elan spinoff with labs in South San Francisco.

In the U.S., you can often hear jokes about venture groups' reluctance to travel to a bordering state, let alone another continent. As a result, biotech hubs like Boston--where VCs cluster--have achieved a powerful rep as capitols of innovation, attracting Big Pharma R&D like bees to flowers. But what makes Woodford such a potent figure is the example he sets in backing global drug development, where even small companies knit together scientific, administrative and support functions from an international cast of players. Looping Asian players into the game will be the industry's next big step.

Distinct from the British government's episodic forays into supporting R&D, Woodford represents the potential influence of global capital on a more diverse set of biotech hubs, including some long-neglected regions. If he inspires just one or two more groups to do the same, the investor's influence on biotech could be profound.

In biotech, it takes a planet. -- John Carroll (email | Twitter)

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