biotech specialists, and behind their investment was a lot of due diligence. At least that’s the belief—and in late 2014, Atlas Venture partner Bruce Booth, an early-stage biotech investor and popular blogger, illustrated how crossover-backed biotechs were faring better than those without crossovers. At the time, biotechs who had gone public since January 2013 with crossover backing had an 83 percent post-IPO stock rise, versus a 10 percent dip for biotechs who didn’t raise cash from crossovers. And those gains were on top of higher pre-IPO valuations and IPO valuations.
Whether they signaled actual quality or just helped create a perception of quality, the financial outcomes were clear. And as Baird’s numbers point out, the crank turned ever faster in the first half of 2015 without any drag on returns. The past two years, taking the difference between share price of the crossover round and the IPO price, investors have averaged a 62 percent return (55 percent median), according to the investment bank. In 2015 so far, it’s a 68 percent average (52 percent median).
Now, finally, a slight pause. If markets continue to roil into the fall, we’ll soon find out if those who made hay in the sunshine can do so under cloudier conditions.
Public Horizon? Biotechs That Have Drawn Crossover Investors In 2014-2015
| Company | Date | Selected Investors | $$ (M) |
|---|---|---|---|
| Adaptive Biotechnologies | May 2015 | Matrix Capital Management, Senator Investment Group, Tiger Management, Rock Springs Capital, Viking Global Investors | 195 |
| Aeglea Biotherapeutics | Mar 2015 | OrbiMed, Jennison Associates, Venrock, RA Capital Management, Rock Springs Capital | 44 |
| CytomX Therapeutics | Jun 2015 | Fidelity, Casdin Capital, Cormorant Asset Management, Deerfield Management, Redmile Group | 70 |
| Dimension Therapeutics | Apr 2015 | RA Capital Management, Rock Springs Capital, Partner Fund Management, Jennison Associates, Tourbillon Global Venture | 65 |
| Edge Therapeutics | Apr 2015 | Venrock, Sofinnova Ventures, Janus Capital Management | 73 |
| Editas Medicine | Aug 2015 | Boris Nikolic (Bng0), Deerfield Management, Viking Global Investors, Fidelity, T. Rowe Price Associates, Google Ventures | 120 |
| GenSight Biologics | Jul 2015 | Fidelity, Jennison Associates, Sphera Global HealthCare Fund, Perceptive Advisors, HealthCap | 36 |
| Intarcia Therapeutics | Apr 2014 | RA Capital Management, Farallon Capital Management, Foresite Capital, Franklin Templeton | 200 |
| Intellia Therapeutics | Sep 2015 | OrbiMed, Fidelity, Janus Capital Management, EcoR1 Capital, Foresite Capital, Sectoral Asset Management | 70 |
| Jounce Therapeutics | Apr 2015 | Wellington Management, Redmile Group, Nextech Invest, Cormorant Asset Management, Casdin Capital, Foresite Capital | 56 |
| Merus | Aug 2015 | Sofinnova Ventures, Novo A/S, RA Capital Management, Rock Springs Capital, Tekla Capital Management | 80.5 |
| Mirna Therapeutics | Apr 2015 | Baxter Ventures, Eastern Capital, Sante Ventures, Morningside Ventures, Rock Springs Capital, Celgene | 42 |
| Moderna Therapeutics | Jan 2015 | Viking Global Investors, Invus, RA Capital Management, Wellington Management | 450 |
| MyoKardia | Apr 2015 | Casdin Capital, Cormorant Asset Management, Perceptive Life Sciences | 46 |
| Ovid Therapeutics | Aug 2015 | Fidelity, Cowen Private Investments, Sanofi-Genzyme BioVentures, Tekla Capital Management, Sphera Global Healthcare Fund | 75 |
| Protagonist Therapeutics | Jul 2015 | Canaan Partners, Adage Capital Partners, RA Capital Management, Foresite Capital | 40 |
| Ra Pharmaceuticals | Jul 2015 | RA Capital Management, Novo Ventures, Lightstone Ventures, Rock Springs Capital, Limulus Venture Partners | 59 |
| RaNa Therapeutics | Jul 2015 | Merck, Baupost Group, Rock Springs Capital, Brookside Capital, Leerink Partners | 55 |
| RegenXBio | May 2015 | Venrock, Brookside, Deerfield, Beacon, GlaxoSmithKline | 71 |
| Syndax Pharmaceuticals | Aug 2015 | Fidelity, Cormorant Asset Management, EcoR1 Capital, Jennison Associates | 80 |
| Syros Pharmaceuticals | Oct 2014 | Polaris, Aisling Capital, Redmile Group | 53 |
| Unum Therapeutics | Jun 2015 | New Leaf Venture Partners, Brace Pharma Capital, Cowen Private Investments, Jennison Associates, Novo A/S | 65 |
| Voyager Therapeutics | Apr 2015 | Brookside Capital, Partner Fund Management. Wellington Management, Casdin Capital | 56 |
| WaVe Life Sciences | Aug 2015 | Foresite Capital, Fidelity, New Leaf Venture Partners, Redmile Group, Jennison Associates, Cormorant Asset Management | 66 |
Note: Investor lists do not reflect all publicly disclosed investors.
