Eleven years ago, Reinhard Ambros became global head of Novartis Venture Funds (NVF) for the Switzerland-based pharmaceutical company, when it had $175m under management. Today, it has more than $750m in committed capital and investments across North America, Europe, Israel and Asia-Pacific.
Last year, NVF invested $80m in new and follow-on rounds, with new portfolio companies including Merganser Biotech, E-scape Bio, Macrolide Pharmaceuticals, Kanyos Bio
In an interview for the inaugural GCV Powerlist, Ambros said: “Novartis Ventures was a small unit, making small investments and had never led a round. It was more a follower than a leader. I said: ‘I will build it into the largest corporate venture biotech group in the world.’ People said: ‘That is a good ambition.’ But they were not really convinced it could be done.”
Novartis Venture Funds has 11 executives and 46 portfolio companies, according to its 2015 annual report, of which 39 are listed on its website. This portfolio covers life science companies from biotech, medical devices and diagnostics and, while it is stage-agnostic and makes early-stage, pre-clinical trial investments, in his annual report Ambros said he anticipated making larger investments of up to $30m per company. Together with the commitment of other syndicate investors, more than $2.5bn has been invested into NVF portfolio companies.
It has also been active in exits. For the 2014 GCV Powerlist award, Ambros said: “I think most (corporate) funds have a too narrow a portfolio in respect to therapeutics, technologies, platforms, devices, diagnostics, but also on geographic coverage.
“That does not mean one has to have one’s own people on all grounds, but having a network may help. I also think we come into a time when mergers and acquisitions will take place later and later and at the moment only the initial public offering window helps, but what if this is closing again. I prepare for later-stage funding support for all my companies now.”
Last year saw the sale of Heptares Therapeutics to Sosei Group for $180m in cash and $220m in milestone payments and flotation of Nabriva Therapeutics last year.
The fund’s total portfolio in 2015 has decreased in numbers over the years from a high point of more than 60 in 2010.
Ambros has been on the board of Aerpio Therapeutics, Aileron Therapeutics, Forma Therapeutics, Genedata and Symetis and also a director of the Novartis Option Fund, an innovative $200m program to support early-stage healthcare companies.
Ambros was trained as a banker and scientist with a PhD in medicinal chemistry and pharmacology in German and a post-doctorate in the US. He said: “I found a very interesting job at Roche in Basel [Switzerland] where I was involved in a number of their development projects.
At that time project management was one of the hottest jobs around. I was one of the few lucky people to see programs move to approval and discussed with the US Food and Drug Administration multiple times in different therapeutic areas.”
He added: “I then moved to Novartis, to manage a key oncology project but got quickly interested in business development and licensing. From there I went to the mergers and acquisition group for a period working on acquisitions, before I was offered the position of head of Novartis strategic planning [in 2001]. After four years I became tired of predicting the future of pharma and wanted to be again much more hands on science and business [and became managing director of the Novartis BioVenture Fund in the US].”
“Overall the future of the sector is going to be stressful and evolution will take its toll on venture capital partnerships but some will do well and form a new group. I am certain we will be among them and it helps to be a leader in this field.”
Novartis’s investment activity since the beginning of 2015
