Will I earn more if I invest in biotech ventures through a Diversified investment fund or one that specializes in Healthcare only investments?
Perhaps surprisingly (perhaps not), the Life Sci VC blog's shows that Diversified funds have done better from 2002-2011, 12.3% to 7.1% total value (realized + unrealized returns).
There is no certainty as to why this may be the case, but a leading hypothesis is that diversified funds may have a bias towards "leaner, more capital efficient biotech bets." Because they have competing tech deals they may do instead, these funds may also avoid "big burn regulatory bets" and "big science platform deals that lack a product-focus".
Or it may just be a statistical fluke. Read for yourself. It is an interesting result regardless given that healthcare funds are supposed to the the investment experts in this area.
Posted by Bruce Lehr Apr 12th 2012.