When UPMC Enterprises joined a Series A fundraising round for Mozart Therapeutics in summer 2023, it wasn’t the result of the biotech startup reaching out looking for an investor.
It was the other way around, with the Translational Sciences team at Enterprises reaching out to the company to see if its leaders were looking for capital and partnership.
This novel and successful approach of proactively engaging companies that fit an investment thesis, rather than waiting for a deal to come their way, is likely to be replicated in the future as the Translational Sciences team steps up efforts to work with the most promising startups both locally and globally.
But how did they get to this point with Mozart?
The Translational Sciences team focuses primarily on a handful of therapeutic areas where it is looking to invest in startups, including oncology, cardiovascular disease, autoimmune disease, central nervous system conditions, and women’s health.
The team identifies therapeutics areas through a market landscape research process that produces a set of key criteria that inform what an attractive investment looks like in each area and a short-list of top biotech investment candidates. The landscapes provide the knowledge necessary to efficiently identify and research investment opportunities.
In addition to the landscapes, the team also started a strategic review of venture capital funds to further filter the pool of opportunities to those with a world-class investor base, a highly valuable criteria for potential investment.
The combination of key criteria identified in landscape process and venture capital fund outreach can lead to opportunities.
“Mozart sat at the intersection of these efforts,” explained Rob Hartman, Senior Director on the team.
The strategic fund review started in late 2022 when Rob and Julian Hassinger pulled together a list of about 40 of the top venture capital funds that had a track record of success investing in promising biotech startups. Each week, a team member would then present during the team’s investment committee meeting about a fund and its investments with suggestions for potential companies they might approach.
It was in early February 2023 when Kelsey Holden presented about Leaps by Bayer, the corporate venture fund of the global health and agriculture company Bayer. At the time, Kelsey and Rob had been in the process of conducting the market landscape in the autoimmune disease space. And one of the investments in Leaps by Bayer’s portfolio stood out to them: Mozart.
Mozart was noteworthy for several reasons. It was developing a treatment for autoimmune diseases with high unmet needs. It appeared to have a promising scientific approach that was differentiated from others in the space. It had several pharmaceutical companies as early investors — a positive indicator about the company’s prospects for being acquired at a later stage. And given that its last fundraising round had been in late 2021, Mozart might be ready to raise a new round.
Those were all great signals. But as it happened, Hank Safferstein, a senior advisor to the team and CEO of Generian, also knew one of Mozart’s board members. A connection was made, and several months later, UPMC Enterprises joined the company’s $25M expanded Series A financing round.
In the year since Mozart was first identified, the team has reviewed 22 funds and taken a more formal approach to examining venture funds. They’ve added more funds to their list, including those who have experience investing in the medical device space. And more of the team’s analysts and directors are involved in the research.
“This really showed the team that our process could work and that the work could yield worthwhile results,” Kelsey said.
