New life science credit company Symbiotic Capital has launched with a fund of more than $600m for life science-specific loans.
Co-chaired by veteran biotech entrepreneur Arie Belldegrun, founder of Kite Pharma and co-founder of Bellco Capital, the US-based company will structure and originate credit solutions to life science companies across healthcare, including medical devices, biotechnology, and synthetic biology.
"As the cost to research, develop and commercialise innovative therapeutics, devices, tools and other products has increased substantially throughout the sector, credit has become an increasingly important financing tool for established healthcare enterprises. With Symbiotic Capital, we have designed a science-first credit platform to fuel those endeavours,” said Belldegrun.
Credit facilities in life sciences are generally less common due to traditional lenders lacking the expertise to accurately value the inherently complex assets typical in the space and regulatory challenges that contribute towards financial uncertainty for lenders.
Symbiotic joins a short list of companies that specialise in life science debt financing, including Hercules Capital and Capital Advisors Group.
According to Symbiotic, credit financings can minimise the equity demands otherwise necessary for R&D and commercialisation activities for life science companies.
"With Symbiotic Capital, we've assembled a uniquely qualified, multi-disciplinary and experienced team that brings together the best of traditional credit underwriting with deep sector fundamentals and expertise,” commented Symbiotic co-chairman Russell Goldsmith.
With credit facilities less common, the life sciences sector is more commonly reliant on investment from venture capital or private equity (PE) companies, yet research by Bain and Company has shown that the deal landscape has been turbulent in recent years, with deal value in 2023 struggling to match the pace of preceding years.
However, GlobalData’s State of the Biopharmaceutical Industry 2024 report revealed that 40% of healthcare industry professionals surveyed globally expressed an optimistic or very optimistic sentiment on biotech funding starting to bounce back over the next 12 months.
Although Symbiotic only publicly announced the launch this week, the company has been providing loans since at least the start of this year.
In January 2024, Accelus closed on a $20m credit facility with Symbiotic. The US-based medical technology company, which launched a spinal implant system for surgeries during the same month, said the funding would provide it with additional resources to accelerate its growth trajectory,
In the same month, Symbiotic also arranged a credit facility at an undisclosed sum for US-based Cleveland Diagnostics, a clinical-stage biotech developing diagnostics tests for early cancer detection.
