Introducing Medicxi Growth 1, Our First $300m Late-Stage Fund

The inherent nature of the biotech sector is such that some startups are bound for greatness early on, usually thanks to some ground breaking biology and the associated therapy to unlock its potential. The dichotomy one then faces is on one side early monetization and on the other further value creation.

Early and meaningful exits are always welcome to the venture community, allowing recycling of cash and management. In many other cases though, it would be preferable for both entrepreneurs and investors to bring the project further along, to generate additional optionality for the business and ultimately to create more value for all involved by further demonstrating clinical usefulness of the drug.

However, over the past years too many talented and passionate European entrepreneurs have been forced into sub-optimal choices to either sell their innovative company too early, give up their crown jewels through licensing, or to embark on a far-reaching and often arduous fundraising tour in the US. This was mainly due to the lack of dedicated late-stage European investors, capable of providing smart capital to maturing companies with compounds in Ph2 and Ph3 of clinical development.

Recognizing this opportunity, we at Medicxi are proud to announce that we have launched our first growth fund: Medicxi Growth 1 (or MG1). The fund is dedicated to support primarily European biotech companies that have generated a strong clinical Proof-of-Concept (PoC) and that we feel should develop their compounds independently through a successful Ph2b/Ph3, regulatory approval and market entry. 

In this regard, MG1 fills a clear need in the European venture sector and extends our platform capabilities to support entrepreneurial teams when it makes strategic sense to build a long-lasting, successful biotech company well beyond the early stages of its development. 

Helping innovative companies to grow beyond their early stages of development is also why I helped launch the first dedicated growth fund at Index in 2007. In the context of that fund, which was mostly focused on the tech sector, Index invested in a couple of successful late-stage biotech companies, namely Micromet Inc. (acquired by Amgen) and Ariad (NASDAQ: ARIA, acquired by Takeda). Both of those were early examples of high power teams and high potential companies that benefited from late-stage investor support to become global leaders in their field. We have also had the luck of backing some companies that went on to become bellwethers of European biotech such as Genmab, or supporting companies that had early but interesting PoC like Aegerion, Novocure and Profibrix and help them deliver successful Ph3 and approval. This reinforced our sense that over the following years Europe would present an increasingly clear opportunity for a later-stage growth fund fully dedicated to life sciences. 

The strategy for our Medicxi Growth fund is clear: investing between €10M and €25M in the equity of promising biotech companies that have solid clinical data, focused on significant unmet medical needs, led by passionate and dedicated management teams capable to lead them through clinical development and regulatory approval. Most of these companies will have created for themselves a clear path to becoming an integrated public company and to considering strategic partnership options with Pharma from a position of strength. Creating the conditions for the best entrepreneurial teams to further develop their company to that valuable stage is why we launched our first Medicxi Growth fund.

We are proud to welcome several new high quality investors in MG1, which include Novartis, our Pharma partner in the fund, Verily (an Alphabet company), and the European Investment Fund (EIF) that has made one of its largest commitments to life sciences, as well as many of our traditional returning financial investors.

With our existing early-stage funds and the addition of MG1 we now provide entrepreneurs with an integrated and solid platform, which is rather unique especially for those based in Europe where the availability of adequate, knowledgeable and experienced investors is not as abundant as in the US.

To be clear, Medicxi remains fully committed to investing in early stage startups, following the Asset Centric model it pioneered 10 years ago. This activity will continue in full force and will be supported by the latest Medicxi early-stage fund, which has recently closed with €210M of capital dedicated to early stage assets and the formation of new startups in which Medicxi will continue to be the main lead investor. 

Our venture and growth funds are managed by our dedicated investing professionals for each fund, who work together as a cohesive team and collectively provide an integrated platform to help our entrepreneurs build their companies into the global leaders and true biotech innovators of the future. Strong impact on unmet medical needs and the healthy financial returns associated with such significant innovation are the common goals we passionately share with the entrepreneurs we back.

Our team is well connected to many of the big Pharmas in the world, of which 3 have decided to back our funds: Johnson & Johnson and GlaxoSmithKline in our latest Medicxi fund, Novartis in MG1. We believe that close proximity to Pharma is both a clear differentiator of our approach to providing value-add to our portfolio, as well as an effective way to foster dialogue between our companies and the Pharma partners that most likely will become relevant in their future development.