Venture capital funding into quality healthcare startups hit a record high last month, according to an analysis conducted by Pitchbook. $20 billion, just in the first 8 months of 2018 has gone into 1,186 deals, up 59% from a year ago...and a 180% from a decade ago. Looking just at the data, you'd never know the CEO of Theranos, once valued at $9 billion, had just told shareholders to dissolve its business.
David Taylor, current CEO of Theranos wrote in a letter to shareholders obtained by the Wall Street Journal, wrote that Theranos was in default under its Fortress credit facility and owes at least $60 million to unsecured creditors. This follows Theranos founder Elizabeth Holmes and her ex-boyfriend Ramesh Balwani and the flood of shocking details about the company's inner workings which two time Pulitzer award winning reporter John Carreyrou chronicled in his book Bad Blood published earlier this year.
Still, the problems for Theranos' have had little to no impact on quality healthcare investor's choices. Biotech startups just by March this year had raised more than in all of 2013, a trend continued throughout the year. Fundraising was down about 11% this August, so it's not all positive, however healthcare startups still raised $1.98 billion from 118 deals. In August 2008, this was $950 million across just 86 deals so still a monumental difference to just a decade ago even accounting for inflation.
It's also worth noting that Pitchbook doesn't count regenerative quality healthcare medicine firm Samumed's $438 million in an August fundraiser in its $20 billion total due to it being private funding, not venture capital. At a $12.4 billion valuation, according to Pitchbook, Samumed continues to be valued more than any traded biotech firm, without drug approval, despite many of its investors remain anonymous.
The money however, has continued to flow. $350 million from The Carlyle Group for One Medical, a concierge-style primary care group. This was the largest venture capital fundraise for August this year, presenting the company with a $1.5 billion valuation, alleged in Pitchbook.
Founder of Rakuten, Hiroshi Mikitani, was the largest investor in the pharma & biotech sector last month, a figure of $150 million in Rakuten Aspyrian (Series C) to develop a photoimmunotherapy platform for cancer.
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