GlaxoSmithKline and Johnson & Johnson have joined forces with Index Ventures to launch a 150 million euro fund for start-ups, a day after the Wellcome Trust announced its £200 million fund to invest in early-stage biotechs in the UK and Europe.
The two healthcare giants are each putting in a quarter of the fund’s assets, with the remaining 75 million euros coming from several of Index’s largest existing partners. The cash will be invested in companies with just one or two projects, rather than those with multiple programmes, and will consider opportunities across Europe, primarily (but also across the USA) “with assets that have first-in-class or best-in-class mechanisms of action and target areas of unmet medical need”.
Moncef Slaoui, head of R&D at GSK, said that “this unique collaboration shows our commitment to the biotech ecosystem and to continuously pursuing creative new ways to access groundbreaking new science”. He added that with its “unique platform of entrepreneurs behind the execution of the ‘asset centric’ investing model, we believe Index is well positioned to create an exciting pipeline of drug candidates”.
Paul Stoffels, chairman of J&J’s pharmaceuticals group, said that “new and creative approaches to funding early-stage innovation are crucial to the development of transformative medicine”. He added that “supporting and nurturing start-ups and encouraging entrepreneurship and innovation will be good for the entire industry”.
News of the Index fund came after the Wellcome Trust has approved the creation of a new business, called Sigma, which will have initial capital of £200 million, that will invest in emerging businesses and technologies in the healthcare and life sciences sectors.
Although Sigma has “the primary goal of generating excellent returns for the Wellcome Trust”, its investments will also provide start-ups with “a valuable new source of funding and guidance”. Sir Mark Walport, director of the trust, said the organisation is known as an investor that takes a long-term view and “Sigma will extend this successful approach…to give small and medium-sized companies the support they require to fulfil their potential”.
