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Venture capital investment in Philly-area life sciences companies fell by a third last year

The sector has been in the doldrums nationwide for two years. Aro Biotherapeutics and Synnovation Therapeutics are among those with recent venture capital successes.

Life sciences companies in Philadelphia received less venture capital investment last year, due to economic headwinds in the industry.
Life sciences companies in Philadelphia received less venture capital investment last year, due to economic headwinds in the industry.Read moreEvgeniy Salov / MCT

Venture capital investment in Philadelphia-area life sciences companies fell by a third last year and is down by more than half since its peak in 2021, as investors cooled on the sector because of high interest rates, and the stock market had little appetite for initial public offerings.

Venture capital investment in local life sciences firms totaled $809.4 million last year, down from $1.2 billion the year before and $2.1 billion in 2021, according to data provided by Savills, a British commercial real estate services firm with an office in Philadelphia.

Savills said the decline in investment means that companies still needing to lease space have an edge over landlords, given that the supply of laboratory space in the region is still growing. Its report is based on data from PitchBook Data Inc., a market research firm.

These deals are among last year’s life sciences investment highlights in the Philadelphia region, according to Savills:

  1. Aro Biotherapeutics, based in the Washington Square neighborhood of Philadelphia, received $41.5 million to continue its work on a genetic treatment for Pompe disease, which causes muscle weakness that worsens over time.

  2. Vivodyne, also based in Washington Square’s Curtis building, secured $38 million in seed funding. The biotech, founded at the University of Pennsylvania, describes itself as a company that “discovers and develops more effective drugs by testing them on lab-grown human organs.”

  3. Penn spinout Interius BioTherapeutics, based in the Pennovation Center, raised $21.5 million. The company is working on a new way to deliver genes to specific cells to fight cancer.

  4. Another Penn start-up, ViTToria Biotherapeutics, took in $15 million from investors. The company, based in the University City Science Center, is focused on developing new CAR-T cell therapies.

Synnovation Therapeutics, based in Wilmington, kicked off 2024 with the announcement last week of $102 million in venture capital funding to develop cancer drugs. A group of scientists from Incyte Corp., a pharmaceutical company also based in Wilmington with seven approved products in the United States, founded Synnovation in 2021.