Despite a downward slide over the last several quarters, things seem to be looking up for venture capital investments in the life sciences — at least anecdotally.
The latest example is a new $250 million fund raised by 5AM Ventures, which invests in early-stage life science companies, primarily those focused on the discovery and development of therapeutics.
The firm first disclosed that it was raising a fourth fund in an SEC filing in October, then said Tuesday it had closed the fund — it’s largest yet. Managing Partner Andy Schwab told VentureWire it was also the firm’s easiest fund to raise to date.
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And there’s a reason for that. This year, 5AM portfolio companies Incline Therapeutics and Pearl Therapeutics were snatched up by The Medicines Company and AstraZeneca, respectively. Relypsa and KaloBios also both went public.
Amid a boom of biotech IPOs this year and growth in M&A activity in Q3, another a sign of optimism is that 5AM Ventures isn’t the only life science investor to raise its largest fund yet this fall. OrbiMed recently rounded up $735 million to invest in healthcare companies, and one of the fund’s partners told MedCity News that the investment climate was rebounding.
Earlier this year, Third Rock Ventures closed a $516 million fund, and Frazier Healthcare surpassed the goal for its seventh healthcare fund, garnering commitments of $377 million from LPs. And, just yesterday, New York City and a few resident healthcare companies announced they were launching a $100 million biotech fund of their own.
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