Venture Capital Still Has Place In Biotech Financing
SAN FRANCISCO-Despite biotech's increasing leverage in partnerships with big pharma, venture capital financing may still be the best way for biotech companies to maintain development control of early-stage products, several members of an industry panel said at the recent BIO Investor Forum
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Domain partner Eckard Weber has become a master of the one-two punch in venture investing. The process (now in its third iteration following Merck's $350 million acquisition of NovaCardia): find a drug no one cares about; create a low-infrastructure company around it; find a second drug; sell off the lead drug through an acquisition; develop the second drug a bit more with the same management; then sell that one too. The first deal at a minimum pays back the investors; the second deal juices the returns. It's a model many VCs want to follow.
Biotechs are retaining a measure of control in the development, manufacturing and commercialization of their products when licensing them to bigger pharma firms
Biotechs may want to look at deal structures with pharmaceutical companies outside of the traditional licensing model in order to have greater control over the development process, Medarex Senior Director of Development Melinda Shockley said at the recent Drug Information Association annual meeting in Philadelphia