Too much money

In 2002, MPM Capital closed what was the largest-ever dedicated healthcare fund. At $940 million, BioVentures III was intended to allow the firm to put its capital to work in $50-$100 million chunks as part of larger deals in companies that either had revenue or expected to shortly.

But that strategy didn't work out, MPM founding partner Luke Evnin told BioCentury, largely because big pharma dramatically ramped up what it was willing to pay to partner with or buy biotech companies. "There are a handful of those deals done every year," said Evnin. "We have found it hard to compete against strategic capital."...