Beyond the genome: private equity’s playbook for the next biotech frontier
Joseph Pategou explores how private equity and venture capital firms are strategically investing in and shaping the rapidly evolving cell and gene therapy landscape, fueling both scientific innovation and commercial development of potentially curative treatments.
Since Professor Martin J. Cline’s first attempt at gene therapy in 1980, biomedicine has made tremendous progress, especially in cell and gene therapy [1]. This field offers hope to millions worldwide by providing potential cures rather than mere treatments for their diseases. But how does private equity and venture capital financing fit into this picture?
Private equity investment strategies
Several private equity investment strategies exist, including leveraged buyouts, growth capital, and venture capital [2]. In 2020, despite the impact of COVID-19, private equity showed resilience. The value of global healthcare buyout deals reached US$66 billion across 380 deals, slightly below the $79 billion in 2019 but above 2018’s $64 billion. Biopharma activity remained robust, with the number of deals increasing to 150 (a 65-deal jump), though deal values fell to $21.4 billion from $40.7 billion in 2019 [3].
At the Alliance for Regenerative Medicine’s annual Cell & Gene Therapies State of the Industry Briefing in 2020 (13 January; San Francisco; CA, USA), then-CEO Janet Lambert shared staggering figures: $20 billion in regenerative medicine financing in 2020, double the $9.8 billion of 2019 and 50% higher than 2018’s $13.8 billion. Gene and gene-modified cell therapy financing rose by 73% to $17.3 billion, while cell therapy financing soared 160% to $10.6 billion. Public market financing reached $9.7 billion (with $3.7 billion from initial public offerings and $6 billion from follow-on offerings), while private financing totaled $10.2 billion [4].
Private equity’s interest in cell and gene therapy continues to grow. In February 2025, Carlyle Group (DC, USA) and SK Capital Partners (NY, USA ) acquired bluebird bio (MA, USA), a gene therapy company, for approximately $29 million in cash. The deal included contingent value rights that could increase the total value to $96 million if certain sales milestones are met. This acquisition provided bluebird with capital to continue developing and commercializing its therapies for diseases like sickle cell disease and beta-thalassemia [5].
Leveraged buyouts and growth capital firms have focused heavily on service providers in the cell and gene therapy landscape, especially contract development and manufacturing organizations (CDMOs). CDMOs are attractive due to their growth potential, value creation and financial visibility for investors. The global CDMO market was valued at $63 billion in 2019 and is projected to reach $119 billion by 2025, with a CAGR of 11.2% [6].
For example, in 2019, EQT Private Equity (Stockholm, Sweden) acquired a 60% stake in Aldevron, valuing the company at more than $3 billion. Aldevron (ND, USA) specializes in manufacturing biologics for the pharmaceutical and biotechnology industries. In June 2021, EQT sold Aldevron to Danaher Corporation (DC, USA) for an enterprise value of $9.6 billion [7].
Curia (NC, USA), taken private in 2017 by Carlyle and GTCR (IL, USA) for $922 million [8], expanded its capabilities by acquiring LakePharma (CA, USA) and Integrity Bio (CA, USA) in July 2021 for over $500 million. This move broadened Curia’s offerings in small and large molecule research, development and manufacturing [9].
In December 2024, Altaris LLC (NY, USA) acquired WuXi Advanced Therapies (PA, USA), the cell and gene therapy manufacturing unit of China’s WuXi AppTec, along with its UK-based entity, Oxgene (Oxford, UK). This divestiture was driven by recent US legislation targeting Chinese firms over national security concerns [10].
In April 2024, Regeneron Pharmaceuticals (NY, USA) entered into a collaboration with Mammoth Biosciences (CA, USA) to develop CRISPR-based gene-editing therapies. Under the terms of the agreement, Mammoth will receive $100 million inclusive of $95 million in equity investment at signing, and an upfront payment, and is eligible to receive up to $370 million per target in development, regulatory and commercial milestone payments, and royalty rates ranging from single digits to mid-teens on future net sales of all collaboration products. In addition, Mammoth has the right to opt-in to cofunding and sharing profits on a majority of collaboration programs in lieu of receiving milestones and royalties [11].
Venture capital and private financing
Private financing for cell and gene therapy has come from partnerships ($3 billion), private placements ($1.2 billion) and venture capital ($5.6 billion). Global venture financings have steadily increased, from $1.55 billion in 2017 to $4.1 billion in 2019, reaching $5.6 billion in 2020. Venture capital firms invested in both early-stage and more mature companies, with $2 billion raised in Series A rounds, $864 million in Series B, $642 million in Series C, and $684 million in Series D and later rounds [12].
For instance, in March 2021, ElevateBio (MA, USA), a cell and gene therapy technology company, raised $525 million in a Series C round led by Matrix Capital Management (MA, USA), with participation from SoftBank Vision Fund 2 (Tokyo, Japan) and Fidelity Management & Research Company (MA, USA) [13].
In August 2021, RiverVest Venture Partners (MO, USA) and Mass General Brigham (MA, USA) led a $17.5 million Series A funding round for SeQure Dx (MA, USA), a gene-editing diagnostics company. The funding will support the company’s development and the establishment of a full-service laboratory for off-target gene-editing analysis, supporting drug development, clinical trials, and patient evaluation [14].
Marianne De Backer, Member of the Executive Committee and EVP of Global Head Strategy and Business Development at Bayer, summed up the optimism in the field at the Alliance for Regenerative Medicine State of the Industry Briefing in 2021 [15]:
“The fact that there is so much venture capital funding going into the space bodes very well for the future. A lot of those companies are going to be harboring pieces of the puzzle of technology that are going to be relevant.”
Looking ahead
The surge of private equity and venture capital into cell and gene therapy reflects a broader shift in how biomedical innovation is financed, scaled and brought to market. From leveraged buyouts of critical manufacturing platforms to strategic venture investments in next-generation gene-editing technologies, financial partners are playing a pivotal role in shaping the future of medicine.
As scientific advances move beyond the genome into complex therapeutic applications, private investors are not only fueling discovery but also accelerating commercialization paths for transformative treatments. With capital flowing into both early-stage innovation and infrastructure, the cell and gene therapy space is poised for a new era, one where financial strategy and scientific progress converge to unlock cures for some of the world’s most challenging diseases.
About the author:
Joseph Pategou has authored over 30 articles in esteemed journals such as Cell and Gene Therapy, The Indian Economist, Labotech.eu, Drug Discovery & Development and others. A former consultant at Boston Consulting Group (MA, USA) in New York, he has held and continues to hold operational roles in biopharma companies. He holds an MBA from New York University (USA) and a master’s degree from HEC Paris (France). You can connect with and follow him on LinkedIn or X.
The opinions expressed in this article are those of the author and do not necessarily reflect the views of RegMedNet or Taylor & Francis Group.