Alphabet's Verily invested in a new $300 million fund Medicxi Growth 1 (MG1) set to back European biotech companies while being run by investment firm Medicxi, the latter announced on Thursday. The subsidiary of the Mountain View, California-based tech giant made the investment alongside Swiss pharmaceutical firm Novartis and the European Investment Fund (EIF), Medicxi revealed. Financial details of the investments into the fund are yet to be disclosed, though EIF's part is said to be "one of its largest investments in life sciences," according to Medicxi. Verily's commitment is presumed to also be significant in light of the fact that the company will name two members of the new fund's Scientific Advisory Board; a privilege that usually isn't given to minor investors in multi-million funds.
The MG1 fund is said to make strategic investments across the Old Continent in an effort to address what Medicxi refers to as a "gap" in funding between Europe and the United States, with its backing being meant for biotech companies that are in late stages of drug development. The investment firm believes that its latest initiative will also make the global pharmaceutical market more competitive by helping promising biotech startups in Europe fulfill their potential and facilitate their efforts to compete with U.S. companies. Even though Medicxi didn't clarify on whether that's an intended effect or just an expected consequence of its future activities, the wording of the company's announcement implies the former. The MG1 fund will start making investments later this year and won't discriminate between public and private entities, with its main criteria being that all firms seeking financial backing have a product that reached mid-stage Phase II clinical development.
Being part of Alphabet's "Other Bets," Verily is seen as a long-term investment that isn't thought to yield significant returns in the immediate future, though the company is reportedly still performing better than the likes of Nest and Fiber, according to comments made by Google's co-founder Sergey Brin last year. Verily has recently been partnering with a number of major parties in the industry, having previously reached deals with the likes of Sanofi and GlaxoSmithKline, and an update on its future efforts is expected to follow in the coming months.