The money will be funneled into early- to mid-stage therapeutic companies with “multi-asset portfolios” for the “next generation” of biotechs in addition to diagnostic and life sciences tools.
Pictured: Hundred dollar bills laid out/iStock_Nattakorn Maneerat
In an indication that investment banking has turned its gaze in 2024 to biotech, Goldman Sachs Asset Management announced Wednesday it has closed its first life sciences fund with $650 million to spend.
Dubbed West Street Life Sciences I, it’s one of the largest first-time private life sciences growth funds, according to Goldman Sachs. The fund’s closing comes over two years after initial setup when the team surpassed its raise goal by $150 million, as reported by The Wall Street Journal.
“We are in a golden-era of innovation in the life sciences, where technological breakthroughs are creating new approaches to diagnosing and treating disease,” Amit Sinha, head of life sciences investing at Goldman Sachs Asset Management, said in a statement.
“We believe the current environment provides an attractive opportunity for investing in the next generation of leading life sciences companies,” Sinha said.
The cash will be funneled into early- to mid-stage therapeutic companies with “multi-asset portfolios” for the “next generation” of biotech companies in addition to diagnostic and life sciences tools.
Around $90 million has already been committed to five companies: MOMA Therapeutics, Nested Therapeutics, TORL Biotherapeutics, Septerna and Rapport Therapeutics. Focus areas include precision medicine, immunotherapy and AI-driven oncology, as well as neurology and rare diseases.
Following the NASDAQ boom of previous years, 2023 IPO funding for biotech companies dropped to $3.4 billion raised in the first three quarters of 2023, compared to $16 billion for the same time period in 2021. Amid a challenging market environment, venture capital funding has become even more important.
However, first-time VC fund statistics haven’t been as high recently either. In 2023, only $11.6 billion was raised—the lowest fundraising total for first-time funds since 2013—according to PitchBook. In comparison, $25.6 billion was raised in 2022.
J.P. Morgan joined the fray in November 2022, launching its own life science-focused equity team—Life Sciences Private Capital—to support early- and growth-stage biotech companies. The fund has yet to disclose its size or any initial investments.
Kate Goodwin is a freelance life science writer based in Des Moines, Iowa. She can be reached at kate.goodwin@biospace.com and on LinkedIn.
