The Hindu Business Line : Novartis Venture Funds looking at innovative India opportunities

Eyeing deals
Currently, the Fund has investments in about 70 companies across the US and Europe, besides formalising a couple of deals more recently in Korea, as well.
But the Fund does not, as yet, have direct equity deals in India or China.

P. T. Jyothi Datta

Cambridge (US), Nov. 2 Valuations that were way too high about a couple of years ago may have deterred Novartis Venture Funds from investing in Indian life-science companies. But the corporate biotech-venture investor still has its eye on India, looking to put its money in companies developing innovative technologies to address “unmet medical needs,” says Dr Campbell Murray, a Managing Director with Novartis Venture Funds.

About $800 million is managed by NVF, and its investments in life-science companies across different markets are through local partners, Dr Murray told Business Line at Novartis’ research headquarters in Cambridge, US.

The 13-year-old NVF is looking for local partners in India as well and is willing to invest “in any area, in any sector,” provided the target company has a strong track-record and the management team has experience of getting drugs approved, he said.

Currently, the Fund has investments in about 70 companies across the US and Europe, besides formalising a couple of deals more recently in Korea. But the Fund does not, as yet, have direct equity deals in India or China, Dr Murray said during the company-sponsored trip.

Providing an unusual cultural insight, he observed that growth in the local innovative start-up environment was possibly getting inhibited also because people seemed to be respected more (“by the mother-in-law”) when they were with large companies, perceived as being more “stable” than start-ups.

This meant that the best person for the job was possibly still part of a large company, rather than with a start-up, he added.

Unmet need

NVF is interested in technology platforms and the target company needs to be involved with developing break-through technology where patients may not have an alternative medicine or therapy, he said, even if the patient population the technology addressed is small. Also working in favour of target companies was strong intellectual property and capital efficiency, he added.

In fact, the present mantra at Swiss drug-maker Novartis is to pursue research pathways to address unmet medical needs of even a small patient population, as opposed to the earlier trends in the pharmaceutical world of chasing the next big block-buster drug.

However, Dr Murray clarified that though NVF was the corporate venture capital arm of Novartis, the Fund was not directly linked to Novartis Pharma.

Option Fund

In 2007, Novartis Option Fund was established with a commitment from the drug-maker of $200 million over five years, he said.

This Fund acts as an incubator for start-ups and also invests in equity, he said, unlike NVF that is not directly connected to drug-maker.

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