Two biopharma giants—Eli Lilly and Celgene—will join GE Ventures and other partners in raising a new, at-least $100 million fund intended to fund up to 20 biotech startups in New York City.
The City of New York Early-Stage Life Sciences Funding Initiative was launched yesterday by the city’s public-private New York Economic Development Corporation (NYCEDC), which committed to raising $10 million. Another $40 million will come from Eli Lilly, Celgene, and GE Ventures—while the remaining $50 million will come from “a select cohort of top-tier investment partners with venture capital and venture creation expertise,” according to NYCEDC.
Additional VC partners are expected to be identified early next year, and the first investments are set to be made in mid-2014. The combined funding will launch “15 to 20 breakthrough ventures” by 2020, NYCEDC said.
The early-stage fund is designed as a capstone to an array of initiatives by the city and private partners to strengthen its life sciences cluster by boosting support for early-stage companies.
“The program will anchor and accelerate the growth of New York City’s ecosystem for venture creation and early-stage research and development, ultimately transforming the landscape of life sciences in the city and advancing cutting-edge innovations for patients in need,” the NYCEDC said in a statement.
Despite access to capital through Wall Street and the presence of nonprofit teaching hospitals, research institutions, plus pharmaceutical, biotech, and technology companies, New York City has until recently lagged behind such top-tier bioclusters as the San Francisco Bay Area and Boston/Cambridge, in large part because of the difficulty startups faced getting established in the Big Apple.
Since the 2007–09 recession, however, New York City has taken a bigger bite of biopharma for reasons that include:
- Greater collaboration by members of the long-fractious community, both with startups and among themselves, the latter reflected in initiatives such as the New York Genome Center;
- Construction of new facilities, notably the Alexandria Center for Life Science on Manhattan’s East Side, which has occupants such as Lilly’s ImClone subsidiary and Roche;
- The solid support of business and political leaders led by Mayor Michael Bloomberg, who leaves office at year’s end
The early-stage fund, according to NYCEDC, is “designed to support the development of new technologies and products for patients and researchers, including therapeutics, medical devices, diagnostics, research and development instrumentation, and digital life sciences technologies."