(Reuters) – Venture capital firm Andreessen Horowitz said on Friday it was working with Eli Lilly to launch a $500 million venture fund that will be fully funded by the U.S. drugmaker.
WHY IT’S IMPORTANT
The fund, Biotech Ecosystem Venture Fund, aims to invest in potentially relevant treatment platforms and “cutting-edge” technology companies with special focus on new science, engineering technologies and artificial intelligence capabilities.
Beyond the capital contribution, Lilly would provide additional resources to the companies, including an access to its pre-clinical and clinical drug development talent and resources.
CONTEXT
Spending on drug development has slowed since early 2023 due to higher interest rates, but with easing inflationary pressures, increasing bets of a soft landing for the U.S. economy and promising data from drug trials, the biotech funding market began to see a boost last year.
These firms, which are heavily dependent on credit are among those that stand to benefit the most from the U.S. central bank lowering its borrowing costs.
KEY QUOTE
“Combining our strengths as organizations will empower founders with not only the venture backing needed to advance groundbreaking technologies, but also the resources needed to strategically select the most promising application areas for these platforms,” said Vineeta Agarwala, general partner at Andreessen Horowitz’s Bio + Health Fund.
(Reporting by Mariam Sunny in Bengaluru; Editing by Shinjini Ganguli)
