Reuters reports that a number of global venture firms have renewed their interest in the life sciences and health-care sectors, motivated by big acquisitions, U.S. laws speeding up certain drug approval processes and new products that have broadened the life-sciences definition. Venture funds invested $4.82 billion in biotechnology in 2011, an increase of 24 percent from 2010; medical-device investments increased 17 percent, and healthcare services investment rose 41 percent. Another key development in the renewed interest are the investments that major pharmaceutical companies are making in early-stage companies, some have even created their own venture funds for this purpose.
Among the venture firms setting aside large sums with a life-sciences focus are Canaan Partners, $600 million, Flagship Ventures, $270 million, and New Enterprise Associates, $2.5 billion. Because the field does not produce quick returns, these investments are typically cyclical, but efforts by U.S. lawmakers and regulators to accelerate the drug approval process particularly for breakthroughs on life-threatening diseases are giving investors hope of quicker returns. Among the new products that have been added to the life-sciences portfolio are those applying information technology to certain health-care problems, such as programs allowing patients to compare the costs of medical procedures, automated appointment booking, DNA testing, medical records, and health-care related apps. See Reuters, September 24, 2012.