A BioEnterprise Midyear Midwest Healthcare Growth Capital Report recorded a little more than $1 billion invested in 249 companies — both record numbers for the first six months of the year since the organization started producing this report in 2005, according to a news release.
In a phone interview, BioEnterprise CEO Aram Nerpouni, who is based in Cleveland, noted that another first since the report began was the healthcare software and services segment attracted the largest investment in the most deals: $538 million across 93 deals, more than half of the total, dominating the biotech and medical device sectors.
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Here’s a breakdown of the top three investment totals by state:
Illinois: $261 million
Minnesota: $226 million
Missouri: $143 million
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Nerpouni said each sector has dominated the others at one point or another. In 2009, biotech deals were in the ascendancy before medical device investment took over for a time and then dominance returned to biotech. Health IT deals dominated in each market this year. In Minneapolis, Bright Health raised $80 million and in Chicago, Accretive Health raised $200 million. St. Louis-based Centene raised $69.5 million.
“Since 2011 software and services has been on a steady, upward trend with investment amount, if not number of deals. It’s probably too early to call out specific locations in the Midwest for software and service deals but it will be great to track over time,” said Nerpouni.
It’s not really surprising that investment in health IT companies has dominated life science sectors in the Midwest since there’s so much money pouring into this area to support the goals of the Affordable Care Act.
Investors in these deals came from both the Midwest as well as both the East and West coasts. “We’re definitely seeing an increase in investors in the Midwest, but it’s less about firms opening offices here than having big investors come into deals here,” said Nerpouni.
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