Three universities in Scotland have agreed to set up a £50m fund to help support life sciences start-ups from academic centres around the UK.
The fund – which will be managed by Rock Spring Ventures – is a little over halfway through its target with £26m raised to date from a variety of sources, including endowments from the universities of Edinburgh, Glasgow and Aberdeen. Other groups supporting the venture include the European Investment Fund (EIF), Scottish Enterprise and the Strathclyde Pension Fund.
One of the objectives of the fund is to bridge a funding gap in the UK, with start-ups from some regions finding it easier to get access to capital than others, according to a Financial Times report.
Rock Spring Ventures is headed by Sinclair Dunlop and Kyparissia Sirinakis – formerly of MASA Life Science Ventures – and already operates in the US from its headquarters in Maryland. It has adopted a similar approach to funding in the US as it is extolling in the UK.
In 2011, for example, it set up a $100m fund targeting life sciences start-ups in mid-Atlantic states in the north east of the country, which Dunlop has described as an “under-ventured” region.
Traditionally the fund has provided funding of a few million dollars to its start-ups, helping them to bring their business to a global stage, with a view to exiting the collaboration about five years later. Often the exit route comes from the sale of the start-up to a larger company.
The news was welcomed by the UK BioIndustry Association (BIA), whose chief executive Steve Bates said: “this new funding for fledgling life science companies in the UK is another boost for the UK biotech sector as a whole.”
Bates added that the new fund, alongside government initiatives like the Biomedical Catalyst and changes to R&D tax credits, “demonstrates that there is now an increasingly positive environment for start-up life science firms in the UK”.
It also follows similar funding announcements from Syncona Partners, Cancer Research Technology’s Pioneer fund and Index Ventures’ early stage fund.