The French VC firm Sofinnova Partners has invested €20M in three Italian biotech companies via its Telethon Fund, which focuses on firms developing treatments for rare diseases.
The deals by the Sofinnova Telethon Fund were made over the last several months. The companies the Fund invested in — Genespire, Epsilen Bio, and PinCell — are developing gene therapies and other treatments to tackle a range of rare genetic diseases such as inflammatory skin conditions and metabolic disorders.
Genespire received €16M of the funding, though the precise amounts received by the other two companies were not officially disclosed. Including these latest deals from the Sofinnova Telethon Fund, Sofinnova has invested a total of €25M in Italian companies over the last six months.
Genespire’s fundraise was the most recent of the three deals. Founded last month, the company is a spin-off from the Milan-based research institute San Raffaele Telethon Institute for Gene Therapy and aims to develop gene therapies with a focus on genetic conditions where the immune system doesn’t function properly, as well as inherited metabolic disorders.
Epsilen Bio — one of the other two companies to receive an investment — was spun off from the San Raffaele Telethon Institute for Gene Therapy in late 2019 and focuses on gene therapies that can silence genes linked to disease.
Founded in Milan in 2008, the final beneficiary on the list, PinCell, aims to tackle rare inflammatory skin diseases with drugs that don’t suppress the whole immune system as current treatments such as steroids do.
The Sofinnova Telethon Fund was launched in 2018 by Sofinnova Partners and the non-profit Telethon Foundation, and totals €108M. It is managed by Sofinnova Partners and supported by ITAtech, an investment platform set up by the European Investment Fund (EIF) and the Italian state-backed investment bank Cassa dei Depositi (CDP).
The investment in Genespire happened amid the raging coronavirus pandemic, which reached Italy earlier than most European countries. According to Graziano Seghezzi, Managing Partner at Sofinnova Partners, these investments are a vote of confidence in the Italian biotech industry during this challenging period.
“This is particularly significant for me because I am from Bergamo, a town in the Lombardy region in Italy, which you may recall was one of the hardest-hit at the start of the Covid-19 crisis,” he told me.
“We have a saying in our region, which is ‘Testa bassa, e lavorare,’ perhaps best explained as ‘Keep calm and carry on.’ This really is what we did, we kept our heads down and got the work done.”
Pierluigi Paracchi, the CEO of Milan-based oncology biotech Genenta, who wasn’t involved with the latest deals, told me that the investment confirms the quality of the science at the San Raffaele Hospital in Milan. However, he also cautioned that there should be more Italian VCs specialized in biotech for the industry to grow.
“It’s almost unbelievable that a French VC is managing the Italian government money to invest in our science, and Italian teams are struggling to raise money from the EIF and the CDP,” he told me.
“As an entrepreneur, I can say that this is the limit here.”
According to Seghezzi, the coronavirus situation continues to cause big uncertainty for the future of European biotech. However, the biotech and medtech industries could be vital for weathering the storm.
“This is an area that will continue to be central to the well-being and prosperity of our societies and economies, perhaps more than ever before,” he concluded.
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