its “no strings attached” policy, JLABS reports that its startups have executed deals with at least a dozen outside venture funds, as well as with Merck, Novartis, Bayer, Bristol-Myers Squibb, and other life sciences giants. Having a front-row seat also has its perquisites, though, as 71 startups have signed deals (sometimes multiple deals) with the Johnson & Johnson family of companies. (Seven JLABS resident companies have collaborated with each other.)
—Five JLABS startups have gone on to initial public offerings: Audentes Therapeutics (NASDAQ: [[ticker:BOLD]]) (out of the South San Francisco site) raised $75 million and SillaJen (San Francisco at QB3) raised about $135 million in its IPO in South Korea. Three IPOs came out of JLABS San Diego: Cidara Therapeutics (NASDAQ: [[ticker:CDTX]]) raised $77 million; Sienna Biopharmaceuticals (NASDAQ: [[ticker:SNNA]]) raised $65 million; and Mirati Therapeutics (NASDAQ: [[ticker:MRTX]]) raised almost $60 million through a restructuring.
—Another eight JLABS companies have been acquired, including Cambridge, MA-based Padlock Therapeutics (acquired by Bristol-Myers Squibb for as much as $600 million), Silicon Biosystems (acquired by Italy’s Menarini Group), and Tem Systems (acquired by Instrumentation Laboratory).
Richter, who joined Johnson & Johnson Innovation after initially managing JLABS as an outside contractor, said JLABS “has taken a very tech-oriented approach” to its operations. “We don’t wait for a big panacea solution. You take a step and see how it goes, experiment and see how it goes. For us, it’s just a constant journey of acting, learning, iterating.”
As an example, Richter said JLABS has created a series of QuickFire Challenge competitions as a kind of crowd-sourcing approach for identifying potential technologies and solutions for a variety of healthcare issues. The company has launched 22 QuickFire Challenges so far, including one that offers as much as $100,000 in grants and one year of free JLABS residence to teams that submit the best ideas, technologies, or solutions for using artificial intelligence to advance drug discovery.
One of the stats that Richter said she is most proud of is that 23 percent of JLABS companies are led by a female CEO, and 18 percent are led by under-represented ethnic minorities. “We put a focus on that, it’s something we support,” Richter said.
Gender diversity has been a hot topic in the industry in recent years, and the focus on women at JLABS “is absolutely a step in the right direction,” said Karl Simpson of LiftStream, a life sciences executive recruiting and consulting firm that has looked at gender diversity in the United States and Europe. Simpson estimates that somewhere between 7 and 9 percent of life sciences CEOs are women, a disparity he attributes chiefly to corporate culture and an accumulation of other factors.
For the life sciences companies that start at JLABS, Simpson said, the challenge is whether those higher percentages of top female executives carry through as startups mature and grow into bigger corporate organizations. “Raising capital as a female CEO is very difficult because men dominate the venture capital industry,” Simpson said. “Boards also tend to be male-dominated. So the question tends to be whether they can go the distance.”
