You’re doing it at valuations that are more sensible, instead of being overly reliant on an over-exuberant market. Because it’s so much harder to access the capital, once you get it, the plan and the science have to be much more clear. “Starting a company in a market like this in many ways actually sets you up more for success. (Red Box Pictures / Scott Eklund Photo) Tight markets make for efficient companies From left: Agustin Mohedas, Steve Gillis and Anna Chen. Read on for more advice and insight from the panel discussion, “Finance: Defining the new normal.” The following comments are edited for clarity and brevity. You can access it, but you have to be creative and you have to wait for positive data,” said Mohedas. Vaccine company Vaxcyte, for instance, recently raised $575 million in a post-IPO equity round after recent clinical trial results, he said. While some fields are hit harder than others, investors are still rewarding good data with cash, said Agustin Mohedas, a portfolio manager Janus Henderson Investors.
“It’s a nuclear winter for investment,” said Umoja CEO Biopharma CEO Andy Scharenberg, referring to cell therapy companies in some areas of oncology, during a separate meeting session. The conservative advice from the panel reflected the mood of biotech leaders at the conference. “It’s now back to the basics,” said Judith Li, a partner at Lilly Asia Ventures. “Companies don’t die from dilution, they die because they run out of cash,” added Steve Gillis, managing director at Arch Venture Partners.Ĭompanies should also consider options like partnerships and early mergers or acquisitions, said Beam.ĬEOs need to be more disciplined about deciding which programs to pursue, generating data, and showing how their potential product or therapy solves a problem, said panelists.
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“You’re just in for more pain later on if you delay it now and keep kind of bridging,” said Chen. Frazier Life Sciences vice president Anna Chen advised going for the larger round. The XBI biotech index is up slightly since the Seagen acquisition announcement, but still about 50% down from an all-time high in February 2021.īiotech leaders seeking cash are asking whether they should do a bridge round of financing from insiders or raise a larger down round at a low valuation, said panelists. After reaching record highs during 20, venture capital funding for life sciences funding is now closer to pre-pandemic levels, and the IPO market has chilled.Īt the same time, the long-anticipated upswing in merger and acquisition deals is starting to happen, led by the $43 billion planned purchase of Seattle-area biopharma company Seagen by Pfizer.
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