BioCentury
ARTICLE | Finance

Pharmas learn their A, B, seeds

Analyzing the surge of newco formations involving corporate VCs

March 9, 2017 10:48 PM UTC

Having stepped in to fill the venture funding void after the financial crisis, corporate VCs are emerging as financing engines for new company formation. Driven largely by the flood of interest in immuno-oncology, pharmas are now more active than ever before in fostering the generation of new start-ups.

According to BioCentury’s analysis of seed and A round investors since 2000, the role of corporate investors in newco formation has surged in the past three years, with 2016 marking the highest level yet. From 2014-16, pharma VCs joined seed or series A rounds for 26-31 newcos per year, accounting for up to 30% of the total number of companies raising seed or series A funding during the period, compared with 12-15 at about 14-18% for the prior three years (see “Corporate Backing”)...