In the Midst Of A Shakeout, Biotech VCs Must Embrace New Partners, New Math

by Alex Lash

Whether the economy recovers or derails into recession again, it's becoming clear that the drug world, and especially the financing of crucial early-stage innovation – the industry's fuel for decades – will not emerge from the crisis in the same form. The pressures are already forging new models and altered expectations among biotech's venture investors – those that survive. The allure of venture as an alternate asset class has dimmed, and venture investors are increasingly hard pressed to find backers. This financial dearth has kick-started a shakeout with predictions that anywhere from a quarter to 40% of venture firms will not be able to raise new funds