• Login
    • Join
  • FOLLOW:
  • Subscribe Free
    • Magazine
    • eNewsletter
    Checkout
    • Magazine
    • News
    • Opinions
    • Top 30
    • Research
    • Supply Chain
    • Device Sectors
    • Directory
    • Events
    • Resources
    • Microsites
    • More
  • Magazine
  • News
  • Opinions
  • Top 30
  • Research
  • Supply Chain
  • Device Sectors
  • Directory
  • Events
  • Resources
  • Microsites
  • Current / Back Issues
    Features
    Editorial
    Digital Edition
    eNewsletter Archive
    Our Team
    Editorial Guidelines
    Reprints
    Subscribe Now
    Advertise Now
    Top Features
    Seeking a Revolution in Clinical Care Through AI

    Diversifying Supply Chains: New Opportunities Post Pandemic and After Brexit

    Addition by Subtraction: The Latest of Machining for Medtech

    Innovation Incubators: An R&D Roundtable

    Virtual Allies: Electronics Manufacturing Services Providers Offer Real Solutions
    OEM News
    Supplier News
    Service / Press Releases
    Online Exclusives
    Press Releases
    People in the News
    Product & Service Releases
    Supplier News
    Medtech Makers
    Technical Features
    International News
    Videos
    Product & Service Releases
    Live From Shows
    Top News
    Axonics Buys Contura to Expand to Stress Urinary Incontinence

    Nurx Appoints Chief Medical Officer

    Median Technologies, UC San Diego to Partner on AI-Based Medical Imaging Technology

    Novel Heart Failure Treatment Technology Scores Positive Trial Results

    New COVID-19 Saliva Test Also Can Detect Variants and Flu Viruses
    From the Editor
    Blogs
    Guest Opinions
    Top Opinions
    Seeking a Revolution in Clinical Care Through AI

    Diversifying Supply Chains: New Opportunities Post Pandemic and After Brexit

    Addition by Subtraction: The Latest of Machining for Medtech

    Innovation Incubators: An R&D Roundtable

    Virtual Allies: Electronics Manufacturing Services Providers Offer Real Solutions
    Top 30 Medical Device Companies
    Market Data
    White Papers
    Top Research
    Rethink Your Medtech ASC Strategy, Part 1

    Pandemic-Level Playing Field: How COVID-19 Made Space for Progress

    Tips for Reigniting Your MDR/IVDR Preparation

    Three Major Innovation Opportunities for Biomedical Textiles

    Use Vertical Integration to Increase Productivity, Drive Innovation
    3D/Additive Manufacturing
    Contract Manufacturing
    Electronics
    Machining & Laser Processing
    Materials
    Molding
    Packaging & Sterilization
    R&D & Design
    Software & IT
    Testing
    Tubing & Extrusion
    Cardiovascular
    Diagnostics
    Digital Health
    Neurological
    Patient Monitoring
    Surgical
    Orthopedics
    All Companies
    Categories
    Company Capabilities
    Add New Company
    Outsourcing Directory
    Medbio LLC

    Qosina Corp.

    Forefront Medical Technology

    MW Life Sciences

    Spectrum Plastics Group
    MPO Summit
    Industry Events
    Webinars
    Live From Show Event
    Industry Associations
    Videos
    Career Central
    eBook
    Slideshows
    Top Resources
    How Grant Funding Works and How It Can Help

    Refurbished Medical Equipment Testing and Certification Under the NEC

    Taking the First Step with Metal Components

    4 Trends Driving Medical Manufacturing in 2021

    Pioneering AI Solutions to Reinforce Healthcare Services
    Companies
    News Releases
    Product Releases
    Press Releases
    Product Spec Sheets
    Service Releases
    Case Studies
    White Papers
    Brochures
    Videos
    Outsourcing Directory
    Concise Engineering

    Medicoil

    maxon

    Qosina Corp.

    Forefront Medical Technology
    • Magazine
      • Current/Back Issues
      • Features
      • Editorial
      • Columns
      • Digital Editions
      • Subscribe Now
      • Advertise Now
    • News
    • Directory
      • All Companies
      • ALL CATEGORIES
      • Industry Associations
      • Company Capabilities
      • Add Your Company
    • Supply Chain
      • 3D/Additive Manufacturing
      • Contract Manufacturing
      • Electronics
      • Machining & Laser Processing
      • Materials
      • Molding
      • Packaging & Sterilization
      • R&D & Design
      • Software & IT
      • Testing
      • Tubing & Extrusion
    • Device Sectors
      • Cardiovascular
      • Diagnostics
      • Digital Health
      • Neurological
      • Patient Monitoring
      • Surgical
      • Orthopedics
    • Top 30 Company Report
    • Expert Insights
    • Slideshows
    • Videos
    • Podcasts
    • Resources
    • eBook
    • Infographics
    • Whitepapers
    • Research
      • White Papers
      • Case Studies
      • Product Spec Sheets
      • Market Data
    • MPO Summit
    • Events
      • Industry Events
      • Live From Show Events
      • Webinars
    • Microsite
      • Companies
      • Product Releases
      • Product Spec Sheets
      • Services
      • White Papers / Tech Papers
      • Press Releases
      • Videos
      • Literature / Brochures
      • Case Studies
    • About Us
      • About Us
      • Contact Us
      • Advertise with Us
      • eNewsletter Archive
      • Privacy Policy
      • Terms of Use
    Columns

    Trends, Opportunities, and Drivers in Early-Stage Life Sciences Investing

    Despite trade wars and economic shifts in China and the EU, early-stage investing in life sciences remained strong in Q1 2019.

    Trends, Opportunities, and Drivers in Early-Stage Life Sciences Investing
    Related CONTENT
    • Mike on Medtech: Update on FDA's STeP Designation
    • Global Medical Device Venture Financing Deals Total $3.84 Billion in Q4 2020
    • FDA Clears B-Secur's HeartKey EKG/ECG Technology
    • Medtech Matters: Hologic’s Breast Health Happenings
    • Evolving Trends in the Medical and Orthopedic Devices Industry
    Byron S. Kalogerou, Partner, McDermott Will & Emery09.06.19
    It’s a great time to be an early-stage life sciences company. Significant funding continues to roll into this sector, driven by legacy venture capital (VC) funds bringing in new dollars, new players that are out-raising their targets, and active corporate venture capital players. Despite trade wars and economic shifts in China and the EU, early-stage investing in life sciences, particularly in the biotechnology and medical devices sectors, remained strong in Q1 2019, improving quarter over quarter with more than $2.8 billion invested into the space. The confluence of funding and an innovation-friendly regulatory environment provide early-stage life sciences companies with ample opportunity to bring their solutions to market. This article explores the factors driving opportunity in this investment space, as well as how investors and companies can position themselves as attractive partners.

    Getting Innovation to Market and Subsectors to Watch
    Recent actions by the U.S. Congress and leadership at the U.S. Food and Drug Administration (FDA) have demonstrated regulatory support for innovative life sciences solutions. Numerous programs, such as the FDA’s Breakthrough Designation Program for medical devices and the Digital Health Precertification Program, among others, have allowed companies to work more closely with regulators, communicate with them prior to approval submissions, and bring products to market more rapidly, while still maintaining patient safety. These programs, which require fewer data submissions at the outset in exchange for increased post-market study and surveillance obligations, can allow companies with smaller budgets to get their product to market earlier.

    Coinciding with the shift in focus from treatment to cure, from status quo to innovation, the first generation of gene cell therapies have arrived, along with a new wave of digital health applications that employ artificial intelligence (AI) and machine learning (ML). New tools, diagnostics, and devices are reshaping the way patients receive treatment across the spectrum of care. These exciting breakthroughs are accelerating discovery and creating a better understanding of the mechanism of action—which, in turn, gives better insight into clinical outcomes, giving investors a more predictable return. Particularly ripe subsectors for investment as indicated by Q1 2019 performance and regulatory attention include:
    • AI and ML: From diagnosing tumors to matching patients to clinical trials, the staggering amount of data collected in the life sciences space presents numerous use cases for AI and ML solutions. While implementation challenges remain, a recent FDA white paper on its efforts to develop a framework for regulating AI products, along with two AI-based devices approved by the agency in 2018, are promising for investors and developers alike. Investors and analysts have taken note, with AI in the life sciences space valued at $902.1 million (forecasted 2019-2024).
    • Medical Devices: Funding for medical devices saw a 7 percent quarter over quarter increase to $701 million in Q1 2019. The FDA’s Breakthrough Device Program, which has granted 112 Breakthrough Designation Requests as of January 2019, is one example of the supportive regulatory environment and a contributing factor to the funding increases seen in this life sciences subsector.
    Transformation-Driven Partnerships: Evaluating and Attracting Targets
    Within this dynamic landscape, early-stage life sciences companies and investors are forming mutually profitable partnerships to bring transformative products to market faster and more efficiently. Life sciences companies can take strategic steps to enhance their value as a potential investment target. When evaluating targets, investors often look for the following elements:
    • Innovation and unmet need. Novel products, therapies, or approaches that address an unmet need in the market are good candidates for investment.
    • The right team. It is often easier to find good technology than good managers, according to some investors. A life sciences company with a well-run team and strong leadership in place makes for a more attractive investment partner. Effective leaders who can clearly articulate the path to commercialization and the cost to do so will attract investment dollars.
    • Cross-border application. More than ever, investors are looking for products that can enter multiple markets, including Europe and Asia Pacific, because an expanded geographic approach can increase returns. Devices and other products that have application to China’s burgeoning market are a particularly hot focus for investors.
    • Opportunities to add value. Many investors seek out targets that present compelling and quantifiable propositions to drive significant costs out of the healthcare system while improving health outcomes. Investors are not seeking opportunities for marginal savings, but rather transformative “move the needle” innovation.
    To set the stage for an effective investment partnership, life sciences companies should reach out early and often to potential investors, well before they are actually looking to raise capital. Attending industry and well-orchestrated partnering events like Life Science Nation’s RESI series can be a good opportunity to connect and develop relationships with a host of potential investors. Investors don’t just invest in a product—they invest in a team—so face-to-face interaction can lay valuable groundwork for a potential partnership. Curating those contacts through counsel, an accountant, and/or banker can reap dividends over time.

    In addition to evaluating whether a partnership is a good fit from a leadership and culture perspective, investors will often consider the following questions when evaluating a potential target—being prepared to speak directly and clearly to these points, as well as to specific goals for the partnership, will allow for a much more fruitful conversation with a potential investor.
    • What is the regulatory risk? What will it take to get the company through the next regulatory milestones in all relevant jurisdictions? Is it reasonable to expect the device or product to be approved globally at the same time, or will there be regulatory lag? What level of investment will it take to get the product into a clinic and generate the necessary clinical data? Investors today are increasingly conditioning funding on these regulatory milestones.
    • What is the reimbursement pathway? With regulatory approval achieved, revenue can only be achieved by executing a reimbursement strategy that addresses coverage, coding, and payment. After satisfying investors on the ability to secure coverage determination and coding, investors will focus on the pricing of a product to assess the sales potential.
    • Does the company have a clear inflection point it is trying to reach? If a life sciences company can’t articulate a specific, discrete strategy for how it will use the funding to develop or commercialize the product, investors may pass on the opportunity.
    • What is the competitive landscape? How big is the market opportunity in various jurisdictions? This evaluation should take into account not just the general consumer or patient pool, but also specific practicalities, such as the number of patients willing to pay a given price for the product, or the treatment paradigms that come into play. Having a good grasp of these specifics can improve conversations with potential investors, because it reduces the amount of uncertainty they will have to devote time and resources to address.
    • What is the exit opportunity? We often counsel our early-stage clients to “begin with the end in mind.” Life sciences investors will want to hear a clearly articulated vision of the exit. Will the company be seeking to access the capital markets in an initial public offering, looking for an exit through an acquisition, or seek to out-license the technology? In the case of an M&A exit or an out-license, companies should identify each of the potential suitors with whom they envision they will one day conduct a deal.

    Changing economic and political environments aside, the life sciences market presents exciting opportunities for early-stage life sciences companies and the investors who believe and invest in them. Early-stage firms with defined strategic goals, an innovative product addressing unmet need and a compelling value proposition, effective leadership, and above all, an exit strategy that enables investors to achieve the returns they are seeking, can position themselves to attract the right investors to bring their solutions to market. 


    Byron S. Kalogerou is the founder of the McDermott Will & Emery’s Life Science Industry Group and the senior attorney in the Boston Corporate Practice. He focuses his practice on domestic and cross-border mergers and acquisitions, finance, and joint ventures and alliances. He has substantial on-the-ground experience structuring mergers, acquisitions, divestitures, and joint ventures on six continents. Byron has extensive industry background in the life sciences, industrial, and manufacturing sectors. He also acts as outside general counsel to a number of companies.
    Related Searches
    • company
    • system
    • sales
    • healthcare
    Suggested For You
    Medtech Matters: FDA’s Ambiguity on Hyaluronic Acid Medtech Matters: FDA’s Ambiguity on Hyaluronic Acid
    Mike on Medtech: Update on FDA Mike on Medtech: Update on FDA's STeP Designation
    Global Medical Device Venture Financing Deals Total $3.84 Billion in Q4 2020 Global Medical Device Venture Financing Deals Total $3.84 Billion in Q4 2020
    FDA Clears B-Secur FDA Clears B-Secur's HeartKey EKG/ECG Technology
    Medtech Matters: Hologic’s Breast Health Happenings Medtech Matters: Hologic’s Breast Health Happenings
    Evolving Trends in the Medical and Orthopedic Devices Industry Evolving Trends in the Medical and Orthopedic Devices Industry
    Medtech Matters: Optimizing Remote Electrophysiology Monitoring Medtech Matters: Optimizing Remote Electrophysiology Monitoring
    Apollo Endosurgery to Welcome New Leader Apollo Endosurgery to Welcome New Leader
    Pandemic-Level Playing Field: How COVID-19 Made Space for Progress Pandemic-Level Playing Field: How COVID-19 Made Space for Progress
    Global Trends in Medtech: OEMs and the Supply Chain Global Trends in Medtech: OEMs and the Supply Chain
    Perspectives on Post-Pandemic: Expect Supply Chain Security to Increase Perspectives on Post-Pandemic: Expect Supply Chain Security to Increase
    Perspectives on Post-Pandemic: For Manufacturers, Flexibility Is Key Perspectives on Post-Pandemic: For Manufacturers, Flexibility Is Key
    A Blueprint for Reducing Medtech Industry A Blueprint for Reducing Medtech Industry's Carbon Footprint
    Medtech Matters: Medtronic Medtech Matters: Medtronic's Robotic Surgery Status
    North American Medtech Deals Fall 17 Percent in Q4 2020 North American Medtech Deals Fall 17 Percent in Q4 2020

    Related Columns

    • Surgical
      Rethink Your Medtech ASC Strategy, Part 1

      Rethink Your Medtech ASC Strategy, Part 1

      ASCs have adopted a strategy to focus on predictable, low-risk procedures with lower complication rates in an out-of-hospital setting.
      Maria Shepherd, President and Founder, Medi-Vantage 02.03.21

    • R&D & Design
      Pandemic-Level Playing Field: How COVID-19 Made Space for Progress

      Pandemic-Level Playing Field: How COVID-19 Made Space for Progress

      Pandemic restrictions may have diminished certain advantages large companies hold over small and mid-sized competitors.
      Dawn A. Lissy, President & Founder, Empirical 02.03.21

    • Tips for Reigniting Your MDR/IVDR Preparation

      Tips for Reigniting Your MDR/IVDR Preparation

      To get the MDR/IVDR preparation ball rolling again, here are four processes to help refocus on achieving compliance with the updated regulations.
      Nicolle Cannon, Founder and CEO, Cannon Quality Group LLC 02.03.21


    • Materials
      Three Major Innovation Opportunities for Biomedical Textiles

      Three Major Innovation Opportunities for Biomedical Textiles

      Biomedical textiles are gaining significant momentum for use in medical devices to facilitate less invasive surgical procedures.
      John Greco, Vice President of Sales, Cortland Biomedical 02.03.21

    • Contract Manufacturing
      Use Vertical Integration to Increase Productivity, Drive Innovation

      Use Vertical Integration to Increase Productivity, Drive Innovation

      The concept of vertical integration is simple: a company combining two or more stages of production that would normally be operated by separate companies.
      Ryan Lipe, Senior Vice President of Sales & Marketing, MGS 02.03.21

    • How to Better Prepare for Regulatory Requests and Minimize Impact

      How to Better Prepare for Regulatory Requests and Minimize Impact

      Pressure to increase efficiency in medical device development has been prevalent over the past year, especially with the intensified regulatory expectations.
      Sandi Schaible, Sherry Parker and Kim Ehman, WuXi AppTec Medical Device Testing 02.03.21


    • C-Suite Challenges in Medtech’s New Normal

      C-Suite Challenges in Medtech’s New Normal

      Many of the usual C-Suite management topics that are key to organizational success will remain the same this year.
      Florence Joffroy-Black and Dave Sheppard, MedWorld Advisors 02.03.21

    • COVID-19: Accelerator of a Modern, Data-Driven Supplier Strategy

      COVID-19: Accelerator of a Modern, Data-Driven Supplier Strategy

      By the time COVID-19 arrived in the United States, global supply chains were already buckling under a historic level of demand.
      Denise Odenkirk, Vice President, Supplier Sales, Global Healthcare Exchange LLC 02.03.21

    • Fixing Face Mask Form and Function

      Fixing Face Mask Form and Function

      Masks for the general public are varied in both style and effectiveness.
      Sam Brusco, Associate Editor 11.04.20


    • Cardiovascular
      The Heart of the Matter: Trends in Cardiology

      The Heart of the Matter: Trends in Cardiology

      Of the three major segments of coronary stents, bioabsorbable stents are expected to have the highest growth between now and 2022.
      Maria Shepherd, President and Founder, Medi-Vantage 11.04.20

    • Virtually the Same? The Challenges of Online Conferences

      Virtually the Same? The Challenges of Online Conferences

      Like everyone else on the planet, I’m turning increasingly to virtual solutions to our physical challenges in the midst of a pandemic.
      Dawn A. Lissy, Founder & President, Empirical 11.04.20

    • Digital Health
      Digital Health Delivers During a Year for the Ages

      Digital Health Delivers During a Year for the Ages

      Internet of Medical Things technologies have emerged as the key enabler of a much more holistic and complete disease-state management toolbox.
      Brad Womble, Senior Director of Strategy, Marketing, and Mergers & Acquisitions, Jabil Healthcare 11.04.20


    • Advanced Technology for Staking and Swaging Medical Plastics

      Advanced Technology for Staking and Swaging Medical Plastics

      It reliably assembles heat- and vibration-sensitive components, and works with a wide range of plastic materials.
      Priyank Kishor, Global Product Manager—PulseStaking, Branson at Emerson 11.04.20

    • Quality Assurance When Supply Chain Disruptions Arise

      Quality Assurance When Supply Chain Disruptions Arise

      From supply chain disruptions to impromptu manufacturing modifications, the medical device industry has faced a whirlwind of complications in 2020.
      Sandi Schaible and Peter Steen, WuXi AppTec Medical Device Testing 11.04.20

    • The Top 30 and M&A in 2021: What’s Next?

      The Top 30 and M&A in 2021: What’s Next?

      With three of the top five companies appointing new CEOs in the last year and the global pandemic eroding earnings, M&A strategies could look a lot different.
      Florence Joffroy-Black and Dave Sheppard, MedWorld Advisors 11.04.20


    Trending
    • Hardy Diagnostics Releases Rapid Test For COVID-19
    • Portable, Home-Use Device Quickly Measures Inflammation Levels
    • 5 Ways Plastics Revolutionized The Healthcare Industry
    • 7 Considerations For Designing Medical Device Mechanisms
    • How Grant Funding Works And How It Can Help
    Breaking News
    • Axonics Buys Contura to Expand to Stress Urinary Incontinence
    • Nurx Appoints Chief Medical Officer
    • Median Technologies, UC San Diego to Partner on AI-Based Medical Imaging Technology
    • Novel Heart Failure Treatment Technology Scores Positive Trial Results
    • New COVID-19 Saliva Test Also Can Detect Variants and Flu Viruses
    View Breaking News >
    CURRENT ISSUE

    January/February 2021

    • Seeking a Revolution in Clinical Care Through AI
    • Diversifying Supply Chains: New Opportunities Post Pandemic and After Brexit
    • Addition by Subtraction: The Latest of Machining for Medtech
    • Innovation Incubators: An R&D Roundtable
    • Virtual Allies: Electronics Manufacturing Services Providers Offer Real Solutions
    • View More >

    Cookies help us to provide you with an excellent service. By using our website, you declare yourself in agreement with our use of cookies.
    You can obtain detailed information about the use of cookies on our website by clicking on "More information”.

    • About Us
    • Privacy Policy
    • Terms And Conditions
    • Contact Us

    follow us

    Subscribe
    Nutraceuticals World

    Latest Breaking News From Nutraceuticals World

    Martin Bauer Group Acquires Majority Stake in Beverage Company Power Brands
    Gencor Announces Positive Results in VeriSperse Bioavailability Study
    PanTheryx Inc. Acquires TruBiotics Brand from Bayer HealthCare LLC
    Coatings World

    Latest Breaking News From Coatings World

    Mule-Hide Products Co. Promotes Steven Litaker to Territory Manager
    Terra Firma, Wanhua Announce New Distribution Partnership
    Gelest CEO Elected to National Academy of Engineering
    Medical Product Outsourcing

    Latest Breaking News From Medical Product Outsourcing

    Axonics Buys Contura to Expand to Stress Urinary Incontinence
    Nurx Appoints Chief Medical Officer
    Median Technologies, UC San Diego to Partner on AI-Based Medical Imaging Technology
    Contract Pharma

    Latest Breaking News From Contract Pharma

    J&J’s Single-Dose COVID-19 Vax Issued EUA
    Icon to Acquire PRA Health Sciences
    Phlow Corp. and USP Form Alliance
    Beauty Packaging

    Latest Breaking News From Beauty Packaging

    Universal Engraving Announces New President
    Raw Sugar Living Expands to Target with New Collection
    Supporting Female Beauty Brand Founders on International Women's Day
    Happi

    Latest Breaking News From Happi

    ACI and CBC Launch Webpage About ‘Quats’
    L’Occitane Launches Hand Cream Inspired by Women
    Kiehl’s Partners with Gyrl Wonder
    Ink World

    Latest Breaking News From Ink World

    Access Direct Mail Doubles Revenue with SCREEN's Truepress Jet520HD
    Etiflex Enters New Markets with Nilpeter FA-22 Installation
    Hydrocarbon Solvents Market to Surpass $8.1 Billion by 2030
    Label & Narrow Web

    Latest Breaking News From Label & Narrow Web

    TLMI analyzes pandemic's effect on label industry in new report
    UEI names Ross Hutchison president
    Schreiner MediPharm and AARDEX partner for clinical trials
    Nonwovens Industry

    Latest Breaking News From Nonwovens Industry

    U.S. Nonwovens Rebrands as Radienz Living
    What You’re Reading on Nonwovens-Industry.com
    Texas Medical Technology Partners with My Protect Kit
    Orthopedic Design & Technology

    Latest Breaking News From Orthopedic Design & Technology

    Pandemic Pain: NuVasive's 2020 Sales Fall 10 Percent
    Fusion Robotics Receives FDA Clearance for Spinal Navigation and Robotics System
    Kaia Health Unveils Next-Gen Complete MSK Care Solutions
    Printed Electronics Now

    Latest Breaking News From Printed Electronics Now

    Comercial Kywi Improves Customer Service, Front-Store Operations with Zebra Mobile Solution
    Global Printed Circuit Board Market Projected to Reach $69.32 Billion by 2027
    Global Smart Glass Market to Register 6.8% CAGR Between 2021-28: Grand View Research

    Copyright © 2021 Rodman Media. All rights reserved. Use of this constitutes acceptance of our privacy policy The material on this site may not be reproduced, distributed, transmitted, or otherwise used, except with the prior written permission of Rodman Media.

    AD BLOCKER DETECTED

    Our website is made possible by displaying online advertisements to our visitors.
    Please consider supporting us by disabling your ad blocker.


    FREE SUBSCRIPTION Already a subscriber? Login