BioPharma, Pharma, Startups

Pfizer devotes $150 million to neuroscience in venture capital funding increase

The company, which cut 300 neuroscience R&D jobs in January, is making the funding a centerpiece of its $600 million VC boost.

New York-based drugmaker Pfizer is kicking $600 million in new funding into its venture capital arm, one-quarter of which will go toward early-stage neuroscience companies.

The company said Wednesday that the fund would also hire new staff, with expertise in drug discovery, clinical development, venture capital investing and business development. The neuroscience component of the new funding will be focused on neuro-degenerative, neuro-inflammatory and neuro-metabolic disorders. Pfizer Ventures’ portfolio includes more than 40 companies and, with $500 million invested to date, the new investment brings the value of its assets to more than $1 billion.

The move comes half a year after the company closed its research and development efforts in neuroscience, cutting more than 300 jobs, primarily in Massachusetts and Connecticut. However, it was reported at the time that it would devote venture capital funding to neuroscience.

Other VC firms have been devoting funding to neuroscience as well. For example, Charlottesville, Virginia-based NeuroVentures has 15 neuroscience-focused startups under its aegis, while Cambridge, Massachusetts-based Atlas Venture has 13.

In a September 2017 blog post, Atlas partner Bruce Booth pointed out that between the periods of 2007-2011 and 2012-2016, venture capital funding for neuroscience firms focused on the same number of companies – about 220 – but in dollar terms rose by nearly $1 billion. Meanwhile, funding from the National Institutes of Health increased from $954 million to more than $8 billion. Booth attributed the increase in funding to the same drivers behind industry interest in a lot of diseases, namely unmet patient need and aging populations.

Cortexyme, based in South San Francisco, California, recently raised $76 million in a Series B funding round from Sequoia Capital, Vulcan Capital, Verily Life Sciences, EPIQ Capital Group, RSL Investments, Huizenga Capital and a large long-term mutual fund. Pfizer was already an existing investor in the company, along with Takeda’s venture capital arm, and others. The company is developing therapeutics designed to target the potential role of bacterial infections in Alzheimer’s disease.

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