In January, the life science investment community descended upon San Francisco for the annual J.P. Morgan Healthcare (JPM) Conference. As we settle into 2024, the overall mood continues to recover from the COVID-19 hiatus that occurred a few years ago, but it does appear that the news flow remains muted. According to Pitchbook, a well-known venture capital, private equity, and mergers and acquisitions database, this continued hesitation is a result of depressed risk appetites, difficulty of commercialization, and ongoing pressures on economic models. At the conference, I noted that many companies were holding meetings with the goal of gauging interest and establishing milestones for fundraising and strategic actions for the second half of the year and into 2025.
Accordingly, no venture deals occurred over $100 million and no private equity deals over $1 billion were revealed during the week of the JPM Conference, which is typically rife with deal announcements. This could be attributed in part to uncertain directions around interest rates – which makes the cost of capital problematic – and the lack of direction that many investors are feeling with the current state of the overall economy.
Neuromodulation Makes News
The largest deal in medtech during the week was Boston Scientific’s $3.7 billion acquisition of urinary and bowel neuromodulation device maker Axonics. Neuromodulation appears to be attracting attention from medtech venture capitalists. Notably, there is a fair degree of potential overlap between the focused ultrasound ecosystem and medtech manufacturers within neuromodulation.
Key Topics from the JPM Conference
Artificial intelligence (AI) was the headline theme among most participants at the meeting. There continues to be hype about the potential for AI to accelerate and transform the pathways for drug discovery as well as the implications for care delivery.
Another notable topic of interest was the transformative effect of glucagon-like peptide 1 (GLP-1) drugs for obesity and their potential other indications like addiction, Alzheimer’s disease, liver disease, and cancer. Appropriately, there is also increased focus on potential treatments for the side effects associated with GLP-1s, like muscle and bone density loss.
Patrick Edelmann is a Senior Advisor for the Foundation’s FUS Partners program. He was formerly managing director at BlackRock, Inc. and member of the firm’s Global Allocation Fund overseeing healthcare-related investments across all asset classes and geography.