Co-authored by Matt Gibbs CipherBio@svb and Steve Agular SVB Managing Director, VC Relationship Management in Healthcare and Life Science.

Most Active Corporate VCs

Corporate venture capital (CVC) is gaining an increasing presence in the life science sector. Some companies invest for financial returns, while others for strategic reasons – to leverage and upgrade their core competencies, get access to nascent markets or innovative technologies, support digital transformation initiatives, or build an ecosystem.

As an extension of their internal R&D efforts, CVCs represent valuable strategic partners for innovative companies as they can leverage powerful corporate clout to open doors to commercial agreements, bring with them brand association, and offer product development and other subject matter expertise.

The growing presence of corporate VCs in the life science space coincided with a drop in availability of capital in the aftermath of the financial crisis when Venture Capital funds (VCs) started focusing on their existing portfolios and shifting their investments away from early-stage biotech startups towards later-stage opportunities. The demand for capital far exceeded the supply as VCs were becoming increasingly more selective. Against this backdrop, healthcare, pharmaceutical, and biotech corporates — traditionally less sensitive to volatility in financial markets compared to companies in other industries — have emerged as active early-stage investors with a healthy appetite for new venture deals. In addition, a strong impetus to change was being driven by a wave of disruption launched by innovative, nimble startups proliferating throughout the economy. Corporates at the forefront of innovation recognized the need to get closer to “the startup way of doing things” to stay relevant in the rapidly changing world. As a result, larger, sophisticated venture units within corporates emerged, with corporate VCs taking an active role in early syndicates and delivering high value to co-investors and companies they finance.

Insights on Corporate VC Investing in the Life Science Industry

We examined the data from the CipherBio database to discover who are the most active corporate VCs in the life science space and what they are predominantly investing in, as well as to explore their behavior in terms of the investment approach and stage of investments, and the factors behind it.

1. What are the Most Active Corporate VCs in the Life Science Space?

Figure 1 illustrates the most active corporate VCs in the life science space from the CipherBio database, while Figure 2 presents the remaining set of life science CVCs we track.

Most Active Life Science Corporate VCsFigure 1: Top Seven Corporate VCs From CipherBio Database; Source CipherBio, April 2020.

GV is leading the table of the top seven life science corporate VCs with 71 investments.

GV (formerly known as Google Ventures) is leading the table of the top seven corporate VCs with 71 investments.  Life science investments account for more than a third of GV’s portfolio which spans across the entire healthcare spectrum, including health IT, diagnostics, care delivery, devices, and therapeutics. In their investment approach, GV shows a particular interest in companies at the intersection of health and information technology. Its parent, Alphabet, is becoming increasingly involved in the life science space even beyond GV with Verily, its life science arm that works across the research and care ecosystems. Verily collaborates with organizations committed to making a positive impact on healthcare, often providing the technical talent, while its partners contribute expertise in clinical research and regulation.

Alexandria Venture Investments, the second most active life science corporate VC in the CipherBio database.

Alexandria Venture Investments, the second most active corporate VC in the CipherBio database, is the strategic venture capital arm of Alexandria, a real estate company focused on serving the life science industry. It provides long-term strategic investments to innovative life science, technology, and AgTech companies, with most notable recent IPOs from Prevail Therapeutics (2019), IDEAYA Biosciences (2019), and Frequency Therapeutics (2019). Alexandria Venture Investments has traditionally played a significant role in the life science space. It was recognized as the most active biopharma investor in 2017-2018 by Silicon Valley Bank and the #1 venture capital investor in the healthcare sector in 2018 by Forbes.

Pfizer Ventures primarily focuses on transformative therapeutics within Pfizer’s core areas: inflammation & immunology, vaccines, oncology, internal medicine, rare disease, and neuroscience. Pfizer Ventures most recent exits include IPOs of Imara, a provider of novel therapeutics for sickle cell disease and hemoglobinopathies, which raised $75M in March 2020; Cortexyme, a clinical-stage biotech company developing therapeutics for Alzheimer’s and other degenerative diseases, which went public in 2019, raising $75M with a $442M at-IPO valuation; and Neuronetics, a company developing non-invasive therapies for psychiatric and neurological disorders which went public in 2018, raising $107.5M with a $284M at-IPO valuation.

Other Most Active InvestorsFigure 2: Most Active Other Corporate VCs From CipherBio Database; Source CipherBio, April 2020.

2. What are the Top 3 Deals For Each of the Most Active Corporate VCs in the Life Science Space

Table 1 illustrates the top three deals for each of the top seven corporate VCs in the Life Science space.

Top 3 Deals For The Most Active Life Science Corporate VCsTable 1: Top 3 Deals for The Most Active Corporate VCs; Source CipherBio, April 2020.

Alexandria Venture Investments, participated in the biggest deals, including Moderna Therapeutics, Relay Therapeutics, and Maze Therapeutics (as of April 2020). Moderna, a company developing an mRNA technology platform — currently prominent in COVID-19 vaccine development — went public in 2018 when it raised over $600M as the biotech sector’s largest IPO at the time. Moderna’s current market capitalization stands at $16.6B as of April 2020. Launched in 2016, Relay Therapeutics is a company at the intersection of computation and biotechnology, committed to developing medicines by leveraging insights from protein motion. Maze Therapeutics is a company founded in 2018 to develop drugs based on genetic insights.

GV closed the second biggest deals in the Life Science space, with its most notable recent investment being EQRx, a biotech company creating less expensive patent-protected drugs, which raised a remarkable $200M Series A in January 2020. Additionally, in 2019, GV syndicated Maze Therapeutics’ $191M Series A and, in March 2020, medical device / digital health startup Element Science’s $146M Series C.

3. Top Corporate VCs are Investing Early

Top Life Science Corporate VCs Are Investing EarlyTable 2: Breakdown of Investment Stages Top Corporate VCs Invest In; Source CipherBio, April 2020.

Corporate VCs have been emerging as a prolific early-stage investor class in the life science space. Table 2 illustrates that among the top CVCs in the CipherBio database, Series A investments clearly dominate, ranging from 32% (SR One) on the lower end to as high as 80% (AbbVie Ventures). There are several factors that may contribute to the explanation of this finding.


Corporate VCs are increasingly investing in early rounds to get more control over the product development process and avoid costly surprises at a later stage.

The biotech industry is known for the high risk of product failure, with an overall probability of success of a clinical trial ranging from 10% to 13.8% (Wong, Wei Siah & Lo, 20219). Risks involved with early-stage biotech companies are often considered higher than in companies with products in the later clinical stage. While there is no doubt that early-stage biotech investments are linked to high levels of uncertainty, there are risk classes beyond scientific, clinical, and technical — and an early-stage investment may afford investors with a higher degree of control over them.

With such a low rate of products achieving regulatory approval and reaching commercialization, early-stage investors seek to de-risk the investment process by releasing money in smaller tranches, controlling the process from the beginning, and avoiding investing more significant amounts in later-stage companies, which can be exposed to more expensive risks such as regulatory, commercialization, and reimbursement.

Without early mitigation of regulatory risks, biotech companies may face an FDA complete response letter down the line, indicating that the regulator will not approve the application, which often leads to significant losses for investors as examples such as Alimera, Orexigen, and Biodel, have demonstrated.

Leveraging their own internal expertise and experience in the drug approval process, corporate VCs are able to develop a robust regulatory roadmap for companies and increase the involvement of specialist advisors and regulatory bodies to minimize these risks and increase success rates in early-stage investments – and they seek to do that increasingly earlier in the clinical development process.

Register for a free CipherBio account to find exclusive life science industry insights.

Sign Me Up

Leverage of Data Analytics

In the life science space, companies usually get funded based on data they collect over the years. For early-stage life science companies, data is viewed as an essential indicator of progress and value, compared to other sectors where business metrics such as monthly recurring revenue or customer acquisition cost are more prevalent.

Corporate VCs are in a unique position to leverage a wealth of data these companies gather throughout the clinical development process from published and unpublished preclinical and clinical trial data to improve the decision-making process, including investment decisions. Leveraging this data enhances investment due diligence and allows earlier access to valuable investment insights about both downside risks and potential returns associated with a particular investment and earlier entrance.

4. What Are The Most Attractive Life Science Verticals For Corporate VCs?

Most Attractive Life Science Verticals For Corporate VCsTable 3: Sectorial Breakdown for Top Corporate VCs; Source CipherBio, April 2020

Biotech has emerged as by far the most significant life science sector for the top seven corporate VCs in CipherBio’s database. Moreover, some CVCs, such as AbbVie Ventures exclusively invest in this vertical, with all of its 29 investments in biotech. Others – Alexandria Ventures Investments, Pfizer Ventures and SR One – have biotech as their main sector of focus, accounting for 88% of their deals.

As noted in one of CipherBio’s recent articles, there may be multiple explanations for this finding. First, biotech companies often generate higher investor interest as, in many cases, they offer early exit opportunities when they are sold before drugs reach marketing approval. Second, biotech trajectories tend to differ from other life science verticals as, in many cases, companies have lower early-stage valuations before they suddenly experience explosive growth.

GV, however, exhibits a higher degree of diversification, with a considerably higher portion of Digital Health/AI investments (34%) compared to its peers. This finding could be explained with GV’s natural inclination towards this space given its parent’s access to a vast amount of digital information and insights as well as in-house expertise and greater familiarity with emerging technology that can be leveraged in Digital Health/AI.

The only other corporate VC that comes close to GV in terms of a more balanced sectoral diversification is Amgen Ventures, with 27% of its deals in the Digital Health/AI space. Amgen is focused on developing AI-powered digital capabilities to improve the way it does a whole host of activities — from drug discovery and patient identification to optimized interactions with physicians. Other technologies the company is leveraging include digital automation, natural language processing, advanced analytics, and data management.

5. Corporate VCs Collaborate to Secure Deals and Syndicates

In a bid to secure the best deals, corporate VCs are working together (Table 4). Alexandria Venture Investments and Pfizer Ventures tend to work together most frequently, with 14 joint deals in total, closely followed by AbbVie Ventures that teamed up with Pfizer Ventures in 13 deals. Alexandria Venture Investments, which seems to be the most collaborative corporate VC overall, also frequently worked with GV (10 deals) and AbbVie (10), closely followed by Wuxi AppTec (9 transactions).

Life Science Corporate VCs Collaborate To Secure Deals And SyndicatesTable 4: Corporate VCs Who Frequently Work Together.

Why Are Corporate VCs Working Together?

When participating in a Series A, corporate VCs have an opportunity to build a syndicate that can take the company all the way to exit without external funding. With so much risk around the science, regulation and product development, building a robust syndicate from the very beginning, centered around several investors that are capable of and willing to fund follow-on rounds, mitigates the financial risk while still allowing for the opportunity to bring in new investors at later stages.

Controlling the financial risk of investment from an early stage allows investors to minimize follow-on funding challenges while they seek to discover which technologies they’ve invested in have the highest chance of success, and consequently offer the greatest return on investment.

The Evolving Role of Corporate VCs in Life Science

Corporate VCs are uniquely suited to help companies grow and succeed by leveraging their valuable technology and product development knowledge, precious insights into commercialization, and access to distribution channel relationships.

At CipherBio, we believe they are a pivotal element of the life science ecosystem, contributing both significant financial resources and highly specialized knowledge. Their involvement tends to correlate with considerable support for successful exit outcomes. As the value creation for corporate VCs is shifting from their core to the ecosystem, they are increasingly incentivized to grow their presence and visibility in supporting it.

At CipherBio, we are also committed to building and enhancing the life science ecosystem. We believe that supporting collaboration between all parties is a big part of that. With data being pivotal in securing success in the modern economy, we set out to collect valuable life science industry data and disseminate it through open access for the benefit of all the players in the ecosystem – investors, companies, and accelerators.

The life science industry has a unique position in the economy and broader society as we are working towards better healthcare and better drugs, saving lives, and enhancing the quality of life for the human population. As joint efforts on developing a COVID-19 vaccine demonstrate, collaboration is the key to making groundbreaking progress for the benefit of humankind. In the same spirit, we at CipherBio believe that open data-sharing is a vital aspect of collaborative efforts that have the potential to propel this noble industry to the next level. In the hope of capturing the full breadth of the ecosystem, we invite all its players to share their data at the CipherBio platform and become an integral part of this movement.

Join CipherBio

You May Also Like
MicroBiome Insights

64 Microbiome Biotechs Raise $1.6 Billion in Investments

In the last decade, a relatively uncharted field exploded in the life…
CipherBio 2020 Biotech Industry Report

2020 Biotech Funding Overview

It has been an unprecedented year so far for Biotech industry and…
Q2 2020 Life Science Accelerators Insights

Q2 2020 Life Science Accelerators Insights

Co-authored by Matt Gibbs @cipherbio_gibbs, Ben Johnson SVB National Head of Early…
Cell Therapy Insights

$18 Billion Invested in 135 Cell Therapy Companies

Cell therapy was born in the 1930s when Paul Niehans earned the…