Sovereign Wealth Funds are Putting More Money Directly into Biotech

Posted on 08/08/2021

For quite some time now, sovereign wealth funds have enlarged their investor role as financial backers of biotech companies. These pools of patient public capital have accompanied hedge funds such as RA Capital, Deerfield, and Perceptive Advisors, in biotech investments. Sovereign funds have bypassed some pharma venture funds to access these biotech startups directly. For example, Abu Dhabi-based Mubadala Investment Company, which has a presence in San Francisco, made notable investments in Recursion Pharmaceuticals, Inc., Outpace Bio, Alloy Therapeutics, Evotec SE, and Science 37, Inc. Other Gulf sovereign funds interested in biotech include the Qatar Investment Authority (QIA), which invested in Bright Peak Therapeutics, Entrada Therapeutics, Century Therapeutics, LLC, and OncoResponse. Entrada Therapeutics is a privately-held biotechnology company dedicated to transforming the treatment of devastating diseases using intracellular biologics. Century Therapeutics Inc is a biotechnology company harnessing the power of adult stem cells to develop curative therapies for cancer.

Gene Editing and Drug Discovery

Drug discovery, oncology treatments, vaccine development, and research tools have been popular areas for sovereign funds. Nestle up north in Juneau, the Alaska Permanent Fund Corporation has a long track-record of backing biotech companies, especially notable ones such as Juno Therapeutics. The Alaska SWF have invested in Codiak Biosciences Inc. and Tessera Therapeutics Inc. Tessera Therapeutics is attempting to pioneer a new way in gene writing. Tessera Therapeutics sees gene writing as the next chapter in the evolution of medicine from small molecules to protein therapeutics to RNA- and DNA-targeting treatments.

Sovereign Wealth Fund Direct Investments in Biotech – U.S. Dollar

Industry Type(s): Biotechnology, Pharmaceuticals, Life Sciences Tools and Services.
Excluding: Open Market and Fund Commitments.

The advances of gene editing, combined with the prospect of a more lenient FDA are drivers of biotech investing growth. On June 7th, the FDA shocked the biotech community when it granted Biogen’s Aduhelm accelerated approval for the early-stage treatment of Alzheimer’s disease. Furthermore, the drug’s eye-gouging annual price of US$ 56,000 has scared insurers and hospitals.

Testing Companies

With its big balance sheet and large private equity deal team, Singapore’s GIC Private Limited is keen on larger capital plays. GIC inked a deal with Grifols in which GIC would invest around US$ 1 billion in Grifols’ wholly-owned US subsidiary Biomat USA. Biomat is a global leader in plasma collection, with a network of 296 U.S.-based plasma collection centers.

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