A new $600-plus million credit firm was unveiled Tuesday morning from Arie Belldegrun and other well-known life sciences names.
Rather than create another venture capital firm, the Kite Pharma founder and famed biotech investor is out with a new investment vehicle named Symbiotic Capital.
The firm is providing loans to biotechs already in clinical testing and drug developers approaching the commercial stage, co-founder Josh Bradley said in an interview with Endpoints News. It is also providing loans to makers of medical devices, diagnostics, life sciences tools and synthetic biology, among other healthcare subsectors.
In the works for the past few years, Symbiotic has already deployed about 40% to 50% of its pool to “more established life science companies,” Bradley said.
“We’ve assembled a really special team here to go out and not just give the companies the loans and the dollars, but actually give them a partnership and access to a great ecosystem and a great team,” Bradley said.
Belldegrun’s Los Angeles-based investment firm Bellco Capital is affiliated with Symbiotic and he serves as co-chairman, according to an announcement on Tuesday morning. Belldegrun is also chair of another investment firm called Two River, which earlier this year created a biotech with Third Rock Ventures to in-license a bispecific T cell engager. Belldegrun also co-founded the life sciences venture firm Vida Ventures and life sciences real estate group Breakthrough Properties.
Symbiotic’s co-chair is Russell Goldsmith, the former chair and CEO of City National Bank, a 70-year-old financing institution owned by Royal Bank of Canada. Goldsmith had an interest in setting up a finance firm in healthcare.
“But as a former major bank CEO, [Goldsmith] was all too aware of the fact that traditional banks just don’t have the tools to understand healthcare and life science companies,” Bradley said. “They don’t understand the FDA, they don’t understand clinical trials, the regulatory environment, the commercial landscape, customer appetite, payors, etc., and never really was able to crack that barrier at traditional banks.”
Former Roche CEO Franz Humer chairs a scientific committee, Bradley said. Symbiotic’s science team also includes former Cleveland Clinic CEO Toby Cosgrove, veteran venture capitalists Amy Schulman and Helen Kim, UCLA scholars Jim Economou and Owen Witte, and Joshua Kazam, who has co-founded multiple companies with Belldegrun, including Allogene and Kite.
In the market downturn of the past few years, multiple biotech venture capital groups have concentrated their bets on clinical-stage biotechs or are providing megarounds to startups so they have ample cash to get into the clinic and beyond to gather their initial proof of concept data. Symbiotic is looking at later-stage biotechs, Bradley said.
“[F]or companies that are later stage, we found that credit can be just a powerful instrument and really compound their success, let them keep fueling their R&D on the lead assets,” Bradley said, “but also support a pipeline of secondary assets and really help them to navigate through those final stages of the clinical work and/or their efforts in the commercialization side.”
That can include both private and public companies, he said. He declined to disclose current clients and said the firm will announce some of the names in the “next couple weeks.”
The loan structure is custom-designed per client, Bradley said, “but the typical thing is something like a five-year loan that might have monthly or quarterly payments along the way but make sure it fits well with their own financing plan.”
Editor’s note: This story was updated to clarify that Josh Bradley meant to refer to traditional banks when discussing being able to “crack that barrier” and to correct that he is a chief investment officer of Bellco, not Symbiotic.