VC Funding In 2013: Some Impressive Device Rounds, But Momentum Shifts To Biotech
Medtech start-ups have closed on some impressive venture capital funding rounds so far this year, with the largest investments concentrated in a few “hot” technology areas. But the biotechnology industry garnered far more VC funding in Q2 than did the medical device sector, particularly with regards to early-stage funding.
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To stave off the sluggish growth in established markets, multinational medtechs not only are finding new business in countries with booming health care industries, but they’re also forging new ways to serve customers. Device companies now are pushing into services, such as disease management, and angling to compete more aggressively on pricing.
The market for insulin delivery devices is positioned to change significantly with several manufacturers gearing their products toward type 2 diabetics, who make up 90% to 95% of the diabetes patient pool in the US. These new, “pump-like” devices could offer the type 2 diabetes population better control in managing glucose levels, a solution the medical community has been seeking for a while.
A $50 million venture fund set up by pharmaceutical giant GlaxoSmithKline has chosen vagus nerve stimulation device start-up SetPoint Medical, a company currently focused on treatments for autoimmune diseases, as its first investment. The move highlights the growing importance of device-mediated therapies for a wide range of common, chronic conditions.