Latest Deals – Bone Therapeutics, Poxel

IPO: Bone Therapeutics (Brussels, BE) raises EUR 32 million (Euronext:BOTHE)
The regenerative medicine company (founded in 2006) develops products for bone fracture repair and prevention; market cap at IPO of EUR 105 million; pre-IPO investors include Nausicaa Ventures, BAMS Angels & Life Science Research Partners.

IPO: Poxel (Lyon, FR) raises EUR 27 million (Euronext:POXEL)
The biotech company (spun off from Merck Serono in 2009) develops drugs for type II diabetes and other metabolic diseases; market cap at IPO of EUR 116 million; pre-IPO investors include EdRIP, InnoBio & Omnes.

Latest Deals – Ascendis, Atlas Genetics, Autolus

IPO: Ascendis Pharma (Copenhagen, DK) raises USD 108 million (NASDAQ:ASND)
The biotech company (founded in 2007) develops a once-weekly human growth hormone and other drugs based on its TransCon technology; market cap at IPO of USD 413 million; pre-IPO investors include Sofinnova Ventures, OrbiMed, Vivo Capital, Gilde & Sofinnova Partners.

Private Round: Atlas Genetics (Bath, UK) raises USD 20 million in Series C
The diagnostics company develops in vitro diagnostics for detection of infectious diseases; new investor RusnanoMedInvest (RMI) joins JJDC, LSP & BB Biotech Ventures.

Private Round: Autolus (London, UK) raises GBP 30 million (USD 46 million) in Series A
The biotech company (spun off from UCL) develops CAR-T cell therapies for oncology; only disclosed investor is Syncona.

Life Sciences Dominate Swiss VC Funding (Swiss VC Report 2014)

Startupticker.ch and SECA just published the Swiss Venture Capital Report covering the year 2014. As always an interesting read – here are some highlights regarding the life sciences sector:

• Of the total venture capital invested in Swiss startups in 2014 (CHF 457 million), 41% went to biotech and 33% to medtech firms. If one includes healthcare IT, life sciences accounted for a whopping 78% of the total VC money invested.
• Last year’s largest financing rounds went to Biocartis (CHF 78 million), NovImmune (CHF 60 million), Anokion (CHF 33 million), Xeltis (CHF 32 million), Sequana Medical (CHF 23 million), CRISPR Therapeutics (CHF 22 million), AC Immune (CHF 20 million) and PiQur Therapeutics (CHF 18 million).
• Notable exits of Swiss startup companies in 2014 included the acquisitions of 4-Antibody (by Agenus), Covagen (by J&J), Oncoethix (by Merck & Co) and Prionics (by ThermoFisher Scientific) as well as the IPOs of Molecular Partners and Auris Medical.

Latest Deals – Convergence, Trophos, AC Immune

M&A: Convergence Pharmaceuticals (Cambridge, UK) acquired by Biogen Idec (US) for USD 200 million upfront
The biotech company (spun off from GSK in 2010) develops ion channel blockers for pain indications; Biogen pays USD 200 million upfront plus milestones up to USD 475 million; investors include Apposite Capital, New Leaf & SV Life Sciences.

M&A: Trophos (Marseille, FR) acquired by Roche (CH) for EUR 120 million upfront
The biotech company (founded in 1999) develops drug for spinal muscular atrophy (SMA); Roche pays EUR 120 million upfront plus milestones up to EUR 350 million; investors include Turenne Capital.

Licensing: AC Immune (Lausanne, CH) licenses Alzheimer’s vaccine to Johnson & Johnson (US)
The biotech company provides license to anti-tau vaccine; potential deal size up to CHF 500 million, including undisclosed upfront payment, milestones and royalties.

Latest Deals – Redvax, Phenex, Genkyotex, Orphazyme

M&A: Redvax (Zurich, CH) acquired by Pfizer (US)
The spinoff from Redbiotec has a preclinical CMV vaccine; terms of transaction not disclosed.

Licensing: Phenex (Heidelberg, DE) sells FXR program to Gilead (US)
The biotech company sells its small molecule program for liver diseases; receives undisclosed upfront payment plus milestones up to USD 470 million.

Private Round: Genkyotex (Geneva, CH) raises CHF 20 million (USD 21 million) in Series D
The biotech company develops selective NOX inhibitors (e.g. for diabetic nephropathy); new investors NeoMed, VI Partners & BioMedInvest join EdRIP, Eclosion2 and Vesalius.

Private Round: Orphazyme (Copenhagen, DK) raises EUR 20 million (USD 24 million) in Series B
The biotech company develops orphan drugs for lysosomal storage diseases; new investors Kurma & Idinvest join Novo, Sunstone & Aescap.

What Can Netflix Teach You About Corporate Culture?

Below is a summary of the (desired) corporate culture of Netflix, a NASDAQ-listed company with close to 2’000 full-time employees. While some aspects of Netflix’s culture are relevant to many growing companies, others are probably specific to the Internet/IT sector (e.g. relative importance of creativity vs processes).

Overall, Netflix’s so-called “Freedom & Responsibility Culture” aims to support rapid innovation and excellent execution as well as effective team work of high-performance people by focusing on the following 7 aspects:

1. Values
   – Work with people who embody these nine values: Judgment. Communication. Impact. Curiosity. Innovation. Courage. Passion. Honesty. Selflessness.
2. High Performance
   – The “Keeper Test” for Managers: “Which of my people would I fight hard to keep, if they told me they were leaving in two months for a similar job at a peer company?”
   – Performance is more important than loyalty or hard work, but “brilliant jerks” are not tolerated if they threaten teamwork.
3. Freedom & Responsibility
   – Responsible people thrive on freedom and are worthy of freedom.
   – Employee freedom, instead of process focus, attracts and nourishes innovative people and allows the company to adapt to a changing environment.
   – Good processes help talented people get more done. Therefore, increase talent density and minimize complexity/rules as the company grows.
   – Example: Netflix policy for expensing, entertainment, gifts and travel = “Act in Netflix’s best interests” (5 words)
   – However, as for “free speech”, there need to be exceptions to “freedom at work” (preventing irrevocable disaster, respecting moral and legal boundaries).
4. Context, not Control
   – The best managers figure out how to get great outcomes by setting the appropriate context, rather than by trying to control their people.
   – Exceptions: Emergencies, employees still learning in their roles or employees in wrong position.
5. Highly Aligned, Loosely Coupled
   – Strategies and goals are clear, specific, broadly understood.
   – Team interactions are on strategies and goals rather than tactics.
6. Pay Top of Market
   – “We endeavour to have only outstanding employees.”
   – Three tests for “top of market” for a person: What could they get elsewhere? What would we pay for replacement? What would we pay to keep person?
   – Bad Ideas: Linking pay to titles, caring too much about internal parity, giving everyone the same raise.
7. Promotions & Development
   – Two necessary conditions for promotion: The job has to be big enough (to warrant a newly created position) and the person has to be a superstar in their current role.
   – Develop people by giving them the opportunity to develop themselves, by surrounding them with stunning colleagues and giving them big challenges to work on.

Full presentation at: http://www.slideshare.net/reed2001/culture-1798664

U.S. Biotech Indices Reach Historic Highs

In Q1/2010, the AMEX Biotech Index (BTK) reached an all-time high at 1254, driven mainly by the performance of Intermune (ITMN, +240%) and OSI Pharmaceuticals (+92%).   >>> BTK Components

Meanwhile, the NASDAQ Biotech Index (NBI) hit its highest mark in more than eight years, at 963.   >>> NBI Components

Both biotech indices stand comfortably above their levels from October 2007 (BTK: +48.2%, NBI + 6.9%), whereas S&P500 subsectors such as energy, utilities, industrials, telecom and financials are down approximately 25-55% over the same period.

Driving forces behind the outperformance of the biotech sector include the resolution of the U.S. healthcare legislation, positive regulatory news, optimism regarding upcoming milestones and the expectation of further M&A activity.

Sources: Inside BIO Blog, BioCentury

17 Emerging Markets To Spur Pharma Industry Growth

In the new “Pharmerging Shake-Up” report, IMS Health focuses on 17 high-growth emerging markets (with per capita GDP < US$ 25’000). Together, these countries already contributed 37% of global pharma growth in 2009. This proportion is predicted to increase to 48% by 2013.

• Tier 1 :  China
  exp. pharma market growth 2008-13: US$ 40+ billion
• Tier 2:  Brazil, Russia, India
  exp. pharma market growth 2008-13: US$ 5-15 billion each
• Tier 3:  Venezuela, Poland, Argentina, Turkey, Mexico, Vietnam, South Africa, Thailand, Indonesia, Romania, Egypt, Pakistan, Ukraine
  exp. pharma market growth 2008-13: US$ 1-5 billion each

While these 17 emerging markets already accounted for 17% of the world pharma market in 2009, the world’s top 15 pharma manufacturer’s derived just 9.4% of their 2009 sales from them. China, today the 5th largest market in the world (behind France and Germany), is expected to jump to 3rd place by 2011 (topped only by the U.S. and Japan).

By and large, European pharma companies have done better in these new markets than their US-based competitors. Ahead of the pack is Bayer-Schering, deriving over 20% of their 2009 sales from the pharmerging markets (esp. strong in China). Sanofi-Aventis (e.g. Latin America) and Novartis (e.g. China, Russia) also outperformed their industry peers in these geographies.

The growth in the “pharmerging markets” is clearly driven by trends like rising GDP, better access to healthcare and improving patent and regulatory situations. However, these countries also pose their own challenges, including the dominance of local companies and brands, the high proportion of generics and the absence of adequate health insurance for many patients. In addition, some of these countries are beginning to respond to rising healthcare costs with tighter regulations, including price controls. Finally, each of these 17 markets presents a unique environment in terms of its population, healthcare infrastructure and competitive landscape.

Source: “Pharmerging Shake-Up”, IMS Health (March 2010)

Downturn Changed LP Expectations Of Private Equity

The Coller Private Equity Barometer is a twice-yearly worldwide survey among more than 100 institutional investors in private equity. Here are some highlights from the Winter 2009-10 edition:

• Perception of private equity has suffered
  50% of European and Asian LPs and 28% of North American LPs view PE less favorably than before the economic downturn
• LPs have lowered return expectations
  Only 29% of LPs expect annual net returns of more than 16% from PE over the next 3-5 years, compared to 43% a year ago
• Exit environment is expected to improve
  65% of LPs expect distributions from their portfolios to improve over the next 12 months, compared to just 4% half a year ago
• 2010 is seen as a good vintage year
  61% of LPs expect 2010 to be a “good” vintage year, another 24% even an “excellent” one (only 2% describe it as “poor”)
• North America is preferred over Europe for VC
  52% of LPs see North American venture capital as one of the best areas for investment over the next 2 years,  compared to just 10% for European venture capital

Source: Global Private Equity Barometer (Coller Capital, Winter 2009-10)

Backgrounds of Top Pharma CEOs

On 1 February 2010, Joseph Jimenez will take over as the new CEO of Novartis. Unlike most of the other top 10 pharma CEOs, Jimenez has spent significant parts of his professional life outside of the healthcare industry.

Following the resignation of Daniel Vasella, John C. Lechleiter of Lilly will be the only top 10 pharma CEO with an MD or PhD degree. Most of his CEO colleagues have business or law degrees.

CEO (Company) – Education / Previous Companies

1. Jeffrey Kindler (Pfizer)
   BA, JD  /  McDonalds, GE
2. Chris Viehbacher (Sanofi-Aventis)
   BA (Commerce), CPA  /  GSK, PwC
3. Andrew Witty (GSK)
   BA (Economics)  /  GSK
4. Joseph Jimenez (Novartis)
   BA, MBA  /  Blackstone, Heinz, Clorox
5. Severin Schwan (Roche)
   MA (Economics), JD  /  Roche
6. David Brennan (AstraZeneca)
   BA (Business)  /  AstraZeneca, Merck
7. William C. Weldon (Johnson&Johnson)
    BSc (Biology)  /  Johnson&Johnson
8. Richard T. Clark (Merck & Co)
   BA, MBA  /  Merck & Co
9. John C. Lechleiter (Lilly)
   BSc, PhD (Chemistry)  /  Lilly   
10. James M. Cornelius (BMS)
    BA (Accounting), MBA  /  Guidant, Lilly

Source: internal analysis