BioCentury
ARTICLE | Finance

Bigger build-to-buy

Why GSK and Avalon are expanding their build-to-buy deal

November 16, 2015 8:00 AM UTC

An expanded build-to-buy partnership with GlaxoSmithKline plc (LSE:GSK; NYSE:GSK) will be a cornerstone for Avalon Ventures as it raises its eleventh fund. The pre-arranged exits will make up half of Avalon's life science investments in the new fund.

In 2013, GSK and Avalon partnered to form and fund 10 companies. Each newco could receive up to $10 million from the partners, including $3 million in series A funding from Avalon and the remainder from GSK in the form of R&D support. For each company GSK buys, Avalon is eligible for up to $40 million in earn-out payments (see BioCentury, June 22)...