With biotech in retreat, Third Rock raises $1B for life sciences investing

Wednesday, June 15, 2022


Third Rock Ventures, a prolific backer of biotechnology startups, announced Wednesday the closing of a billion-dollar fund that will be used to launch and build new life sciences companies.

The fund, Third Rock’s sixth, comes amid a significant downturn in the biotech stock market, which has raised questions about the ability of venture firms to secure additional capital as well as returns on their investments. Indeed, the last year or so has seen declines in the two main ways early biotech investors earn returns: initial public offerings and acquisitions.

Yet, the market slump hasn’t stopped some venture firms from bringing in record hauls for further life sciences investing. Atlas Ventures, which backed companies like Actelion and Alnylam Pharmaceuticals, closed its largest-ever biotech fund of $450 million in March. Three months later, the Third Rock team has done the same with a $1.1 billion fund that it expects to support the creation of roughly 10 startups.

“It’s been a challenging environment in the last few months,” said Jeffrey Tong, one of Third Rock’s partners. “But on the company creation side … we just have a very loyal base of [limited partners] who are investing across a long-term time horizon.”

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