Biotechnology venture capital investing is a unique animal. Impressive returns can be obtained, but there are attendant risks: uncertain and lengthy FDA approval process; long investment holding periods for investments; reimbursement issues; difficult IPO environment; and the rise of milestone payments in M&A deals. Peter Johann of NGN Capital discusses the Biotech venture investing environment, including IPOs, M&A, Private Investments in Public Entities (PIPEs), and more, in an interview with the Jutia Group "Follow Venture Capital to Big Gains in Biotech: Peter Johann." The interview gets a bit technical towards the end, but overall it's an interesting look at Biotech venture investing. Here's the link: http://jutiagroup.com/20120705-follow-venture-capital-to-big-gains-in-biotech-peter-johann/
There's an interesting article posted yesterday on the Fortune Term Sheet website by Lisa Suennen of the Psilos Group discussing the decline of healthcare venture capital investing in the US, and why she believes good investment opportunities still exist. Here's the link: http://finance.fortune.cnn.com/2011/11/14/hey-where-are-all-the-healthcare-investors-going/?iid=SF_TS_Lead
I agree with much of what Ms. Suennen says in her article. One additional problem is the time frame for investing in US biotechnology deals has stretched out. In my view, these factors suggest that early stage biotechnology investing doesn't fit will within a venture capital framework where funds have 10-12 year terms. Smart VCs in this area are adapting to this new paradigm, but overall, healthcare venture investing is challenged.
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