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December 19, 2016

Top 10 Young Companies in the Money of 2016

Investor Funk Seen for Most of This Year Gives Way to Larger Financings in Q4

Top 10 Young Companies in the Money of 2016

Despite renewed investor confidence in biopharma, reflected in a surge of large financings since October 1, the combined size of biotech financings within the top 10 this year was down nearly 14% from 2015. [hocus-focus/Getty]

  • The investor funk that kept biotech stocks down for about half of this year helps explain why private funding of early-stage biopharmas slipped during the first three quarters of 2016, according to one key measure. Between January and September, a total $5.3 billion in venture capital was invested in 305 early-stage companies (compared with $6 billion in 371 in the same period last year), according to the quarterly MoneyTree™ Report published by PricewaterhouseCoopers (PwC), based on data from Thomson Reuters.

    But this year’s GEN tally of early-stage drug and diagnostic developers that closed on millions of dollars in private funding during 2016 (as of deadline on December 2) tells another story.

    Of the top 10 financings that made this List, four were announced since October 1, reflecting renewed investor confidence in biopharma—a sentiment that gained steam in the weeks since Donald Trump’s election caused market-watchers to conclude that Washington will be unlikely to contain ever-rising drug prices once he takes office.

    That bounceback aside, the combined amount of the top 10 “Young Company” biotech financings within this year was down 8.4% from 2015—$2.030 billion, compared with $2.217 billion in 2015. This year’s top financing was recorded by the same company that topped last year’s list, and was even larger than the financing that topped the 2015 List.

    As was the case with GEN Lists published last year, in 2014, and in 2013, this year’s tally does not include companies that secured private funding and later went public, or filed registration statements to do so. None of the companies on this year’s list meets that category.

    Also not included are public companies that raised large sums of private funding. Only one such company would have otherwise made this year’s list—MorphoSys, which on November 15 said it raised approximately €115 million (about $123 million) in a private placement in which it issued 2,622,088 new shares to institutional investors in Europe and North America at €44 ($49) per share.

  • #10. DalCor Pharmaceuticals

    Amount: $110 million1

    Type: Series B financing

    Date announced: April 19, May 131,2

    Purpose: Fund a Phase III trial of dalcetrapib, a CETP inhibitor, in patients who have recently experienced acute coronary syndrome

    Financing leaders: New investors Caisse de dépôt et placement du Québec, the Fonds de solidarité FTQ, and CTI Life Sciences; Founding investors Sanderling Ventures and André Desmarais

    Additional financial partners: Undisclosed investors

  • #9. Unity Biotechnology

    Amount: $116 million

    Type: Series B financing

    Date announced: October 27

    Purpose: Expand ongoing research programs in cellular senescence and advance the first preclinical programs into human trials

    Financing leader: None denoted

    Financial partners: ARCH Venture Partners, Baillie Gifford, Fidelity Management and Research Company, Partner Fund Management, and Venrock (all new investments); Other investors include Bezos Expeditions, the investment vehicle of Amazon.com CEO Jeff Bezos, and existing investors WuXi PharmaTech and Mayo Clinic Ventures

  • #7 (tie). Denali Therapeutics

    Amount: $130 million

    Type: Series B financing

    Date announced: August 25

    Purpose: Fund the company’s therapeutic pipeline and blood-brain-barrier delivery technology platform

    Financing leader: Baillie Gifford

    Additional financial partners: All of Denali's founding investors—which include ARCH Venture Partners, F-Prime Biosciences, Flagship Ventures, and the Alaska Permanent Fund—as well as “several new and large institutional investors.”

  • #7 (tie). Zymergen

    Amount: $130 million

    Type: Series B financing

    Date announced: October 11

    Purpose: Accelerate growth to further support customers, in addition to recruiting top talent across software engineering, automation, and biology

    Financing leader: SoftBank Group

    Additional financial partners: New investors Iconiq Capital, Prelude Ventures, and Tao Capital Partners; Prior lead investor Data Collective; Return investors True Ventures, AME Cloud Ventures, DFJ, Innovation Endeavors, Obvious Ventures, and Two Sigma Ventures

  • #6. CStone Pharmaceuticals

    Amount: $150 million

    Type: Series A financing

    Date announced: July 3

    Purpose: Focus on addressing the specific needs of Chinese patients, by developing a pipeline that covers five therapeutic areas, including its core therapeutic focus of immuno-oncology, as well as cardiovascular diseases, rheumatoid arthritis, hematology, and autoimmune diseases

    Financing leader: None specified

    Financing partners: Oriza Seed Venture Capital, Boyu Capital, and WuXi Healthcare Ventures 

  • #5. Intarcia Therapeutics

    Amount: $215 million3

    Type: Equity financing

    Date announced: September 15

    Purpose: Positioning company toward a “strong strategic and financial position” over the next 2–3 years as it prepares for the potential approval and launch late next year of ITCA 650 (continuous subcutaneous delivery of exenatide), a once- or twice-yearly therapy for the chronic treatment of type 2 diabetes; and the parallel progression of several novel pipeline programs in chronic diseases that include diabetes, obesity, and auto-immune/inflammation

    Financing leader: None specified

    Financial partners: Undisclosed new “world-class” institutional investors, family offices, a “large and long-term” VC/private equity fund of Lucion Venture Capital Group, and undisclosed existing investors “that have come into the company over the last 5–6 years”

  • #4. Human Longevity

    Amount: “In excess of” $220 million

    Type: Series B financing

    Date announced: April 4

    Purpose: Fund the growth and expansion of the company and its products: these include the first Health Nucleus, HLI's comprehensive, genomic-enhanced, research-based health center; ongoing development of the HLI Knowledgebase which currently has more than 20,000 complete genomes coupled with phenotype data; the Comprehensive Cancer Program, and other sequencing programs

    Financing leaders: None denoted

    Financial partners: Illumina, Celgene, GE Ventures, and a “strong” participation from Series A investors, based in the U.K., Malaysia, Mexico, Australia, Kuwait, Hong Kong, and China, in addition to the U.S.

  • #3. BlueRock Therapeutics

    Amount: $225 million

    Type: Series A financing

    Date announced: December 12

    Purpose: Give company at least four years of runway; allow company to advance a number of programs into the clinic, with an initial focus on cardiovascular diseases and neurodegenerative disorders. Company aims to develop best-in-class induced pluripotent stem cell (iPSC) therapies

    Financing leaders: Bayer and Versant Ventures.

    Additional financial partners: None denoted

  • #2. Innovent Biologics

    Amount: $260 million

    Type: Series D financing

    Date announced: November 29

    Purpose: Accelerate the company’s continued development of its pipeline of biologic therapeutics, several of which have entered clinical studies

    Financing leaders: Future Industry Investment Fund, a private equity fund managed by SDIC Fund Management Corporation Limited, a subsidiary of State Development & Investment Corporation; Other “blue chip” investors including China Life Private Equity Limited, Milestone, Ping An, and Taikang Insurance Group.

    Additional financial partners: Existing investors Legend Capital, Temasek, and Hillhouse Capital

  • #1. Moderna Therapeutics

    Amount: $474 million

    Type: Equity financing

    Date announced: September 7

    Purpose: Continued growth of its clinical pipeline and accelerated advancement of development candidates into clinical studies; construction of a new Good Manufacturing Practice (GMP) manufacturing facility in anticipation of increasing clinical activities across therapeutic areas; sustained investment in its mRNA technology platform at the pace of $100 million per year; continued expansion into new therapeutic areas and modalities

    Financing leader: None denoted

    Financial partners: Existing institutional investors and “world-class” strategic pharmaceutical partners, all undisclosed; as well as new institutional investors from the U.S., Europe, and Asia, also undisclosed

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