Philippe Pouletty (Credit: Deinove)

No pain, no gain: Com­pa­ny-build­ing French VC scores €250M for life sci­ences fund

In the Truf­fle Cap­i­tal play­book, you ei­ther go big or go home.

The French VC firm does not both­er with pitch­es from com­pa­nies vy­ing for in­vest­ment — in­stead, it sources the raw ma­te­r­i­al to build com­pa­nies from scratch. On Wednes­day, it un­veiled a €250 mil­lion boost to in­vest in the life sci­ences, in par­tic­u­lar, the realm of in­ter­ven­tion­al med­ical de­vices.

The recipe for in­vest­ment is ar­du­ous. The firm ap­prais­es about 1000 un­pub­lished patent ap­pli­ca­tions from the top 50 uni­ver­si­ties across the Unit­ed States and Eu­rope. Af­ter whit­tling the list to five per year, it goes about ne­go­ti­at­ing ex­clu­sive glob­al li­cens­es.

A ma­jor source of ‘dis­rup­tive’ sci­ence and tech­nol­o­gy is acad­e­mia, but on­ly some 20% to 30% of patents from uni­ver­si­ties give rise to com­pa­nies be­cause aca­d­e­m­ic re­searchers tend to want to re­main with­in the halls of acad­e­mia, Philippe Poulet­ty, co-founder and chief of Truf­fle Cap­i­tal, not­ed in an in­ter­view with End­points News. “So you have maybe 70% of patent ap­pli­ca­tions which are left aside if you will.”

Once the tech­nol­o­gy is li­censed, Truf­fle in­vents a name for the com­pa­ny, hires the man­age­ment team and puts in mil­lions to de­vel­op the tech — all the while re­main­ing the largest, typ­i­cal­ly soli­tary share­hold­er. In the last 15 years, the firm has backed more than 70 com­pa­nies — of which 80% were cre­at­ed by or with the sup­port of Truf­fle teams. Al­to­geth­er, 13 com­pa­nies, such as Abi­vax, have gone on to make pub­lic de­buts, while Truf­fle has made 17 ex­its, in­clud­ing sales to Stryk­er and Boston Sci­en­tif­ic.

Truf­fle — which is named af­ter the fa­mous black truf­fles of Périg­ord, a re­gion east of Bor­deaux in south-west France in­hab­it­ed by its co-founders — sets up its star­tups in France, but the Eu­ro­pean ap­petite for in­vest­ment is eclipsed by in­vestors in the Unit­ed States, Poulet­ty ac­knowl­edged.

Get­ting be­tween €30 to €50 mil­lion in a Se­ries A fund­ing is pos­si­ble, but cer­tain­ly, Eu­ronext is not as pow­er­ful nor as deep as Nas­daq, he not­ed.

“So that means that when you want to grow fur­ther the com­pa­ny to the com­mer­cial stage, it’s more dif­fi­cult,” he said. “So M&A is of­ten the pre­ferred route, which is why we’ve sold a num­ber of com­pa­nies, which is not great for the Eu­ro­pean econ­o­my be­cause most of the buy­ers are US com­pa­nies…soon they will be Chi­nese com­pa­nies.”

But the in­vest­ment cli­mate in Eu­rope is ripe for change, he added, not­ing that the French and Ger­man au­thor­i­ties are think­ing of putting to­geth­er a raft of in­cen­tives to chan­nel more in­vest­ment in­to the biotech and tech in­dus­tries.

“So I’m quite op­ti­mistic that in the next five years, you should see com­pa­nies be­ing able to grow like in the US on Nas­daq and do­ing big sec­ondary of­fer­ings.”

Cre­at­ed in 2001, Truf­fle Cap­i­tal has raised over €1.1 bil­lion so far. Aside from its fin­tech in­ter­est, the firm’s Bio­MedTech strat­e­gy is fo­cused on tech­nol­o­gy that helps pa­tients more ef­fi­cient­ly and cost-ef­fec­tive­ly with­in the fields of car­di­ol­o­gy, neu­rol­o­gy, der­mo-cos­met­ics, on­col­o­gy, gas­troen­terol­o­gy, and or­tho­pe­dics.

The work has al­ready be­gun. Five com­pa­nies have been cre­at­ed with this new in­jec­tion of funds, in­clud­ing Holi­Stick Med­ical, which is fo­cused on treat­ing se­ri­ous car­diac ail­ments with­out open-heart surgery; Ski­nosive, which is work­ing on tech­nol­o­gy to pre­vent skin can­cers; and Art­e­drone, whose au­tonomous mi­cro-ro­bots are be­ing en­gi­neered to pre­vent and treat cere­brovas­cu­lar is­sues. An­oth­er three are slat­ed for 2020, and the plan is to cre­ate up to a dozen com­pa­nies in to­tal.

“We build the com­pa­ny, we have 90% own­er­ship, and if we suc­ceed, we can say, thanks to Truf­fle oth­er­wise this com­pa­ny would not ex­ist,” Poulet­ty said. “If we fail, we say we were stu­pid and we don’t ac­cuse some­one else of mis­takes. It’s our suc­cess or our mis­takes.”

Pfiz­er’s Doug Gior­dano has $500M — and some ad­vice — to of­fer a cer­tain breed of 'break­through' biotech

So let’s say you’re running a cutting-edge, clinical-stage biotech, probably public, but not necessarily so, which could see some big advantages teaming up with some marquee researchers, picking up say $50 million to $75 million dollars in a non-threatening minority equity investment that could take you to the next level.

Doug Giordano might have some thoughts on how that could work out.

The SVP of business development at the pharma giant has helped forge a new fund called the Pfizer Breakthrough Growth Initiative. And he has $500 million of Pfizer’s money to put behind 7 to 10 — or so — biotech stocks that fit that general description.

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Bris­tol My­ers is clean­ing up the post-Cel­gene merg­er pipeline, and they’re sweep­ing out an ex­per­i­men­tal check­point in the process

Back during the lead up to the $74 billion buyout of Celgene, the big biotech’s leadership did a little housecleaning with a major pact it had forged with Jounce. Out went the $2.6 billion deal and a collaboration on ICOS and PD-1.

Celgene, though, also added a $530 million deal — $50 million up front — to get the worldwide rights to JTX-8064, a drug that targets the LILRB2 receptor on macrophages.

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Leen Kawas, Athira CEO (Athira)

Can a small biotech suc­cess­ful­ly tack­le an Ever­est climb like Alzheimer’s? Athi­ra has $85M and some in­flu­en­tial back­ers ready to give it a shot

There haven’t been a lot of big venture rounds for biotech companies looking to run a Phase II study in Alzheimer’s.

The field has been a disaster over the past decade. Amyloid didn’t pan out as a target — going down in a litany of Phase III failures — and is now making its last stand at Biogen. Tau is a comer, but when you look around and all you see is destruction, the idea of backing a startup trying to find complex cocktails to swing the course of this devilishly complicated memory-wasting disease would daunt the pluckiest investors.

Fangliang Zhang, AP Images

UP­DAT­ED: Leg­end fetch­es $424 mil­lion, emerges as biggest win­ner yet in pan­dem­ic IPO boom as shares soar

Amid a flurry of splashy pandemic IPOs, a J&J-partnered Chinese biotech has emerged with one of the largest public raises in biotech history.

Legend Biotech, the Nanjing-based CAR-T developer, has raised $424 million on NASDAQ. The biotech had originally filed for a still-hefty $350 million, based on a range of $18-$20, but managed to fetch $23 per share, allowing them to well-eclipse the massive raises from companies like Allogene, Juno, Galapagos, though they’ll still fall a few dollars short of Moderna’s record-setting $600 million raise from 2018.

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As it hap­pened: A bid­ding war for an an­tibi­ot­ic mak­er in a mar­ket that has rav­aged its peers

In a bewildering twist to the long-suffering market for antibiotics — there has actually been a bidding war for an antibiotic company: Tetraphase.

It all started back in March, when the maker of Xerava (an FDA approved therapy for complicated intra-abdominal infections) said it had received an offer from AcelRx for an all-stock deal valued at $14.4 million.

The offer was well-timed. Xerava was approved in 2018, four years after Tetraphase posted its first batch of pivotal trial data, and sales were nowhere near where they needed to be in order for the company to keep its head above water.

RA Cap­i­tal, Hill­house join $310M rush to back Ever­est's climb to com­mer­cial heights in Chi­na

Money has never been an issue for Everest Medicines. With an essentially open tab from their founders at C-Bridge Capital, the biotech has gone two and a half years racking up drug after drug, bringing in top exec after top exec, and issuing clinical update after update.

But now other investors want in — and they’re betting big.

Everest is closing its Series C at $310 million. The first $50 million comes from the Jiashan National Economic and Technological Development Zone; the remaining C-2 tranche was led by Janchor Partners, with RA Capital Management and Hillhouse Capital as co-leaders. Decheng Capital, GT Fund, Janus Henderson Investors, Rock Springs Capital, Octagon Investments all joined.

Por­tion of Neil Wood­ford’s re­main­ing in­vest­ments, in­clud­ing Nanopore, sold off for $284 mil­lion

It’s been precisely one year and one day since Neil Woodford froze his once-vaunted fund, and while a global pandemic has recently shielded him from the torrent of headlines, the fallout continues.

Today, the California-based patent licensing firm Acacia Research acquired the fund’s shares for 19 healthcare and biotech companies for $284 million.  Those companies include shares for public and private companies and count some of Woodford’s most prominent bio-bets, such as Theravance Biopharma, Oxford Nanopore and Mereo Biopharma, according to Sky News, which first reported the sale. It won’t include shares for BenevelontAI, the machine learning biotech once valued at $2 billion.

Drug man­u­fac­tur­ing gi­ant Lon­za taps Roche/phar­ma ‘rein­ven­tion’ vet as its new CEO

Lonza chairman Albert Baehny took his time headhunting a new CEO for the company, making it absolutely clear he wanted a Big Pharma or biotech CEO with a good long track record in the business for the top spot. In the end, he went with the gold standard, turning to Roche’s ranks to recruit Pierre-Alain Ruffieux for the job.

Ruffieux, a member of the pharma leadership team at Roche, spent close to 5 years at the company. But like a small army of manufacturing execs, he gained much of his experience at the other Big Pharma in Basel, remaining at Novartis for 12 years before expanding his horizons.

Covid-19 roundup: Ab­b­Vie jumps in­to Covid-19 an­ti­body hunt; As­traZeneca shoots for 2B dos­es of Ox­ford vac­cine — with $750M from CEPI, Gavi

Another Big Pharma is entering the Covid-19 antibody hunt.

AbbVie has announced a collaboration with the Netherlands’ Utrecht University and Erasmus Medical Center and the Chinese-Dutch biotech Harbour Biomed to develop a neutralizing antibody that can treat Covid-19. The antibody, called 47D11, was discovered by AbbVie’s three partners, and AbbVie will support early preclinical work, while preparing for later preclinical and clinical development. Researchers described the antibody in Nature Communications last month.