By Lucy Parkinson, Senior Research Manager, LSN

LSN founded the RESI conference with the goal of providing a venue for life science CEOs to build relationships with potential investors and partners. In addition to the opportunity to book up to 16 back-to-back partnering meetings, RESI offers a full day of panel sessions at which CEOs can hear the latest on tactical fundraising straight from leading life science investors. And since each of the 16 sessions is focused on a different life science sector or investor category, RESI’s panelists can speak to a diverse range of companies, offering relevant experience from throughout the biotech, medtech, diagnostic, and healthcare IT fields.

The RESI @ TMCx morning session will offer separate biotech and medtech panels, featuring angels, family offices, and major healthcare corporations that work with startups in these areas. In the afternoon, RESI’s panels will be more topical, with two sessions devoted to new funding alternatives in life science — venture philanthropy and emerging development models — and six sessions focused on fundraising . Finally, in the Tales from the Road session, the audience will hear from start-up CEOs about their recent experiences in raising money to grow their companies.

Throughout these 16 panels, active life science investors will share their insight and provide tactical advice on outreach, positioning, and building the right relationships to move your product forward. Visit the RESI @ TMCx agenda and click on each panel to view the full speaker lineup.

By Alejandro Zamorano, VP of Business Development, LSN

Tomorrow the partnering platform for RESI @ TMCx goes live, making scheduling a meeting with relevant companies and investors just a few clicks away.

The sheer quantity and diversity of investors attending RESI, paired with the power of the RESI Partnering Platform, makes the RESI conference the place for early stage life science companies to meet investors that are a fit.

LSN has partnered with Meeting Mojo, an emerging partnering portal developer based in the UK to develop the RESI Partnering Platform. RESI attendees can use the system to find other attendees who are a fit for their product, development stage, and other relevant factors.  This highly customized solution uses metatagged profiles populated by LSNs propitiatory investor data that can be searched by the  entrepreneurs to pinpoint a specific fit for an investment mandate by one of the investment firms present at RESI. The RESI Partnering Platform provides the foundation for a one-of-a-kind partnering experience based on current investor mandates that can be easily matched to the emerging biotech and medtech startups that fit the investment criteria.

In short RESI partnering provides an opportunity for life science companies and investors to meet the right people, create compelling dialogues, and foster long-term relationships.

The list below represents the investors who are currently confirmed to attend the RESI @ TMCx conference this June 8th in Houston. This number can be expected to double during the final month leading up to the event. Whether you are just thinking of raising capital in the life science space or have actively begun the process, the RESI conference offers a one-of-a-kind opportunity to get some feedback and build relationships with the investors in your market.

The ROI from attending the RESI conference is pretty dramatic. A fundraising CEO can book up to 16 one-on-one meetings for the day through our partnering software, and more by taking advantage of the networking opportunities that are offered before and during the event. No matter where you are in the fundraising process, RESI @ TMCx is the place to start a dialogue that will hopefully evolve into a compelling relationship and ultimately an allocation.

What makes RESI such a uniquely valuable event for life science entrepreneurs is not only the number of active investors we bring to the table, but also their diversity. RESI has unigue value in that its primary focus is the bringing together 10 categories of investors, including family offices, corporate venture capital, large pharma and biotech, venture capital, and more as depicted in the chart below. This breadth of diverse early stage investor participation makes RESI a great fit for a life science fundraiser seeking any kind of investment, from seed money to series A or B capital to strategic partnership.

Whether your company was just formed or you are looking for capital to fund your next clinical trial, it is never too early to start a relationship with an investor, and the RESI conference will have a strong showing of those with serious interest in the life science space. All of these investors will be profiled in our partnering software, which goes live next week and helps you schedule a meeting based on mutual fit with just a few clicks. Start the fundraising dialogue now. Register here.

Still have questions? Feel free to email or call our conference manager Natasha Eldridge at n.eldridge@lifesciencenation.com or 617-580-5001; she will be happy to address any concerns you have.

By Lucy Parkinson, Senior Research Manager, LSN

It’s been an exciting Q1 for the biotech industry, with the PwC MoneyTree Report recording 193 biotech and medtech venture financing deals. The LSN Company Platform tracks life science financing events more broadly than the MoneyTree Report; in addition to venture financing rounds, the platform also records other forms of financing secured by the 30,000 biotech and medtech companies tracked, including debt financing, research grants, IPOs, and post-IPO offerings. This is useful information if you’re providing services in the life science sector and need to know your customers’ capital landscape. The platform also records the lead investor and any co-investors in each financing event.

It may be months before all the deals that took place in Q1 are formally announced and accounted for, but at present the LSN Company Platform has recorded 229 life science financing events that took place in Q1 2015. These financings raised a total of almost $10 billion, buoyed by huge late stage private rounds and follow-on public offerings. Among the financing events LSN tracked, the median amount raised was $15 million. Figure 1 provides a complete breakdown of the amount raised by the financing events recorded in Q1:

Q1 saw a healthy crop of small, sub-$5 million rounds, which are typically raised by early stage companies, but also many significantly larger raises, including post-IPO financings in which companies that went public in 2013 and 2014 tapped the markets for additional capital.

While the bulk of the tracked financing events occurred in the U.S., the LSN Company Platform also recorded deals in Canada and throughout Europe, the Middle East, Asia, and Oceania (see Figure 2).

In 157 cases, the LSN Company Platform recorded the indication areas in which the companies are developing assets (in many cases, the companies were targeting more than one indication area). Figure 3 shows that oncology was the leading field for financing, with 62 oncology companies raising money in Q1; companies in diseases of the nervous system and metabolic diseases rounded out the top 3 indications for life science financing.

In 125 of the 229 records, the LSN Company Platform was able to track the phase of development of a company’s lead asset. (The rest include companies for which this isn’t relevant or doesn’t fit on the biotech development pathway, such as life science service providers and many medtech or healthcare IT companies, and cases in which the phase of the lead asset is unknown). As Figure 4 shows, the largest number of raises involved companies with a lead asset in Phase II, but LSN tracked financing events for companies as early in the pipeline as the discovery stage:

This chart demonstrates that it’s never too early to think about financing, even if your company is still at the discovery stage of development. In addition to giving you some vital runway time, talking to investors now can help you plan out your future fundraising path; financing rounds generally take 9 to 18 months to close, and the more interested investors you can be in touch with at the early stage, the easier it will be to bring those later rounds together.

By Natasha Eldridge, Marketing Manager, Life Science Nation

The healthcare IT sector is booming, with $6.5 billion invested in healthcare IT companies in 2014. As the Texas Medical Center taking a lead on supporting healthcare IT companies in the Southwest, RESI @ TMCx will feature a panel session exploring investment in the sector.

LSN has gathered a group of experienced healthcare IT investors to share their expertise and advice with entrepreneurs. These investors focus on the information technology opportunities that underlie healthcare innovation, from the possibilities created by big data to the digitization of healthcare providers and research labs. Panelists will discuss issues related to funding in healthcare IT, such as: How do you make your company stand out in this crowded marketplace? What do investors see as the most high-potential fields of innovation in healthcare IT? How do you demonstrate to an investor that your product has the potential to succeed?

• Eugene Zhang, Founding Partner, TEEC Angel Fund
• Michael Peck, Venture Partner, Flyover Capital
• Momei Qu, Senior Associate, Baird Capital
• Tom Hawes, Managing Director, Sandbox Industries

By Shaoyu Chang, MD, MPH,  Senior Research Analyst, LSN

As the pharmaceutical industry is cutting back on R&D, more and more big corporations in the field are searching externally for innovative technologies to replenish their pipelines. For biotech start-ups, partnership with these big players not only offers a source of funding, but also helps them tap into a broader knowledge base of therapeutic sector expertise, drug development, regulatory submission, and commercialization.

Experienced, serial biotech entrepreneurs are well-versed in leveraging big pharma to create value for their ventures; however, many first-time entrepreneurs do not understand how to position themselves and communicate effectively with this segment, therefore they miss out on the opportunity to cultivate big pharma relationships.

• “My company has to be impeccable before I can show it to big pharma.”

Often fundraisers hesitate to reach out to big pharma because a technical detail is under development, a certain test is not completed, or the technology is simply “not ready.” As my colleague Michael Quigley has advised[1], outreach should begin as early as a consistent branding and messaging package can be prepared, despite the fact that some data may be pending. The aim with this outreach should be to introduce your company and establish a relationship, rather than to make a direct solicitation for funds.

“Initiating dialogue with big pharma early gives you many advantages,” said a former director of external research at a major pharmaceutical corporation in a recent interview. “You will have a better understanding of what pharma wants and where their interests are. You will also gain insight on where your company stands within the competitive landscape.” With this information, an entrepreneur has a better chance of conducting the right studies that will create value for the company.

• “If I am in conversation with one big pharma company, I should focus on that relationship. If they find out that I am speaking to other pharma groups, it may sour our relationship.”

Engaging in a dialogue with a big pharma company is a great milestone. However, upon reaching this point, many entrepreneurs wrap themselves in a false sense of security and stop contacting other potential partners. Compared with traditional VC funds, big pharmaceutical corporations generally take longer to review and reach a decision regarding investment, especially when it comes to preclinical assets. A company may risk running out of cash if their only dialogue does not reach fruition within a critical timeframe.

What is a comfortable number of big pharma groups to talk to simultaneously? “Somewhere between four to twelve,” said a veteran venture capitalist and MIT professor. Entrepreneurs should not worry about irritating potential pharma partners. Big pharma corporations know each other, and collaboration between them is common. Therefore, entrepreneurs should disclose to potential pharma partners that they are in conversation with other parties. Interest from other big pharma companies lends credit to an asset and offers the entrepreneur an opportunity to demonstrate their ability to maintain confidentiality in a professional manner. In some cases, a healthy sense of competition can lead to higher valuation and even a bigger deal size as big pharma corporations try to outbid each other on a hot technology.

• “If a pharma does not invest in me, they are not interested. I should look elsewhere.”

You are advised to always do your homework first: figure out what a big pharma partner is looking for, how your technology can complement their existing pipeline, and how to get introduced to the key person who might be interested in your technology.

However, entrepreneurs must remember that making a connection with big pharma does not result from a “hit-or-miss” shot, but from a dialogue, which is an ongoing dance. Many decision makers at pharmaceutical corporations are scientists themselves who are genuinely interested in new technologies. However, they are also worried about risks when making an investment decision. If they think you are too risky for investment now, they can lay out the steps you need to take to make yourself investable in the eyes of the firm.

More and more frequently, big pharma corporations are choosing to enter some form of collaboration with early stage companies on high risk, preclinical technologies. “Instead of licensing, big pharma enters service-based agreements with a small biotech to test their technology by using big pharma’s facility, such as disease models or animal labs, at no cost,” said the former pharmaceutical corporation director interviewed. “In exchange, the biotech shares data with its pharma partner.” Such collaboration serves as an opportunity for a small biotech to gain early validation data and open doors to further cooperation in the future.

In 2014, big pharma struck 559 licensing deals, with an average total deal size of $280 million.[2] The same year also saw $234 billion in merger and acquisition (M&A) activity in the pharmaceutical sector.[3] For many entrepreneurs, collaboration with the right big pharma partners can provide invaluable access to technical guidance, market intelligence, and funding. You must be mindful as you proceed in your outreach, but it is never too early to start!

[1] Michael Quigley. “Four Reasons Why It Is Never Too Early to Build Relationships with Investors.” Next Phase: Life Science Nation Blog. Accessed from https://blog.lifesciencenation.com/2015/03/26/four-reasons-why-it-is-never-too-early-to-build-relationships-with-investors/

[2] The Boston Consulting Group. “2014 Biopharmaceutical Partnering Survey.” Page 6. Accessed from http://www.slideshare.net/TheBostonConsultingGroup/2014-biopharmaceutical-partnering-survey

[3] Steve Sapletal. “After A Blockbuster 2014, What Will 2015 Hold For Pharmaceutical M&A?” Benzinga. Accessed from http://www.benzinga.com/general/education/15/02/5220037/after-a-blockbuster-2014-what-will-2015-hold-for-pharmaceutical-m-a#ixzz3Y1AG7dNI

By Michael Quigley, Director of Research, LSN

As family offices have been increasing their exposure to direct private investments, the ability to contact these groups is benefitting fundraising entrepreneurs in a number of industries, including the life sciences. LSN’s research team has been building and maintaining dialogues with these groups for nearly three years and in doing so we have identified five strong channels for finding family offices.

1. Web/LinkedIn Search

Having recently discussed how the LSN Research Team uses advanced search techniques to uncover investors, I won’t go into too much detail here. Suffice it to say, many family offices, particularly those that are highly active in the life science space, have a significant web presence and can be identified by using Boolean Operators to target both Google and LinkedIn searches. As these groups have established these communication channels with the intent to be found, they also tend to be more open to outreach and the discussion of new opportunities.

2. Legal Firms

Family offices usually have legal representation that is often outsourced to a legal firm. These groups can provide a solid, trusted reference for young companies. If you have a relationship with a lawyer or legal firm, it is definitely worthwhile to ask if they are currently working with any family offices or high-net-worth clients interested in direct transactions in your space. Being referred by these groups can help your company bypass the fear that a family office might have of being scammed or duped.

3. Foundations

Family offices often contribute a portion of their assets to philanthropic organizations, including disease foundations, which can often foster introductions. Many foundations list major contributors on their websites and in press releases so that is a great place to start your research. These family offices often have direct ties with the disease the foundation is working with making them more likely to have interest in your opportunity. Being introduced through the foundation may be especially helpful if the organization has significant scientific expertise in the disease area and is able to validate your opportunity to the family office.

4. Academic Institutions:

Family offices, also often with a philanthropic motive, make significant contributions to academic institutions and frequently serve on the schools board. These Institutions often list board member and significant donors on their website, so those can both be great places to look. Additionally contacting the school or their tech transfer office can also lead you up the stream to who is funding them (pending they are willing to tell you). Family offices funding Academic Institutions do so in many cases to leave a lasting legacy and have a positive impact in the world, this desire to make impact can make them good targets for funding life science companies looking to impact healthcare.

5. Conferences

There exist a number of family office conferences that take place all around the globe. However, if you plan on going to a general family office conference without a direct investment focus, there will only be a small fraction of those in attendance that will be interested in your opportunity. Not all family offices go direct and not all of those that do invest in the life sciences. Also, many planners of these events are loose in their application of the label “family office,” so, if possible, it is important to conduct some due diligence on the attendees before signing up. In our experience a company has a greater chance of finding a fit with a family office when they attend a conference focused on an area that is connected with their technology.

These five channels have been valuable resources for LSN Research in the past and have led to a number of the relationships we currently have with family offices. However, as with any potential investor pool, you should not spend your time trying to contact and follow up with every family office you can find. While these groups can be more flexible with their investments and their level of risk tolerance than more traditional capital sources, not all of them are making direct investments into life science companies. You should be sure to research previous deals a family office has been involved with, perhaps by speaking with a mutual third party; this will let you know whether reaching out would make sense. If you are able to target them properly, family offices represent a significant source of financing for life science companies.