Hello,

We noticed you're browsing in private or incognito mode.

To continue reading this article, please exit incognito mode or log in.

Not a subscriber? Subscribe now for unlimited access to online articles.

Business Impact

Venture Capitalists Love Biotech Right Now

Scientific advances and new business models are spurring investor confidence in biomedical-related ventures.

Developing innovative drugs, therapies, and devices is often extremely expensive.

Venture capital investment in U.S. life sciences companies soared 29 percent in 2014 from the year before, reaching $8.6 billion, the highest level since 2007. And there is reason to think 2015 will also be a big year for a sector having its third boom of the last two decades.

Biotech is the second biggest category for venture investment after software. VCs are gaining confidence in life sciences companies (which include those developing new drugs and therapies as well as those that make medical devices and equipment) partly because their underlying research has advanced significantly, says Greg Vlahos, life sciences partner at PricewaterhouseCoopers, which published the new numbers. A big spike in IPOs by biotech companies over the past two years has also made the field more enticing.

Distinguishing 2014 from the booms in 2000 and 2007, says Vlahos, was the record number of “megadeals” of over $100 million. The $446 million investment round in Moderna Therapeutics, which is developing a novel class of drugs based on messenger RNA (see “Messenger RNA Could Create a New Class of Drugs”), was the largest Vlahos’s group has ever seen for a life sciences company. 

Become an MIT Technology Review Insider for in-depth analysis and unparalleled perspective.

Subscribe today
More from Business Impact

How technology advances are changing the economy and providing new opportunities in many industries.

Want more award-winning journalism? Subscribe to MIT Technology Review.
  • Print + All Access Digital {! insider.prices.print_digital !}* Best Value

    {! insider.display.menuOptionsLabel !}

    The best of MIT Technology Review in print and online, plus unlimited access to our online archive, an ad-free web experience, discounts to MIT Technology Review events, and The Download delivered to your email in-box each weekday.

    See details+

    12-month subscription

    Unlimited access to all our daily online news and feature stories

    6 bi-monthly issues of print + digital magazine

    10% discount to MIT Technology Review events

    Access to entire PDF magazine archive dating back to 1899

    Ad-free website experience

    The Download: newsletter delivered daily

  • All Access Digital {! insider.prices.digital !}*

    {! insider.display.menuOptionsLabel !}

    The digital magazine, plus unlimited site access, our online archive, and The Download delivered to your email in-box each weekday.

    See details+

    12-month subscription

    Unlimited access to all our daily online news and feature stories

    Digital magazine (6 bi-monthly issues)

    Access to entire PDF magazine archive dating back to 1899

    The Download: newsletter delivered daily

  • Print Subscription {! insider.prices.print_only !}*

    {! insider.display.menuOptionsLabel !}

    Six print issues per year plus The Download delivered to your email in-box each weekday.

    See details+

    12-month subscription

    Print magazine (6 bi-monthly issues)

    The Download: newsletter delivered daily

/3
You've read of three free articles this month. for unlimited online access. You've read of three free articles this month. for unlimited online access. This is your last free article this month. for unlimited online access. You've read all your free articles this month. for unlimited online access. You've read of three free articles this month. for more, or for unlimited online access. for two more free articles, or for unlimited online access.