In a crowded biotech landscape full of potential, especially in advanced therapeutic medicinal products (ATMPs), companies must differentiate themselves from their competitors to raise much-needed capital from investors.
This can be a challenge for biotech companies in the space, where some fall victim to the “valley of death,” where companies fail to transition from proof of concept to commercialization.
While navigating the valley of death can be a challenging feat, the data suggests that investors are still committed to the sector. This is evidenced by a 2025 report from GlobalData, which reveals that the biotech industry saw a 70.9% increase in the total value of venture funding deals between the second and third quarters.
Meanwhile, a survey conducted for GlobalData’s State of the Biopharmaceutical Industry 2026 report found that 39% of respondents are optimistic or very optimistic about their prospects for biotech funding recovery over the next year, a value that has increased 24% since May 2025.
At Terrapin’s Advanced Therapies conference, taking place at London’s ExCeL Center on March 17-18, investors dove into what they look for when allocating capital to a startup and how companies can secure their attention over competitors in the current funding landscape.
In a session, Ilya Yasny, a partner at LanceBio Ventures, noted that he primarily seeks to invest in biotech with solid data that addresses unmet needs. “Often, we see startups that are too lax with data. Developing a drug means spending time and investors’ money in exchange for data and risk reduction, so every bit of information you get from an experiment should reduce the risk of your program and increase the value of your company,” Yasny said.
Matthieu Coutet, partner at Sofinnova Partners, shared similar sentiments in his session, highlighting the importance of a solid data package as well as a solid intellectual property strategy.
in conversation with Pharmaceutical technologyYasny added that once a company has the data, it must adapt its strategy around it. “Startups should consider how to position themselves with respect to their data stack and how they will differentiate themselves from the standard of care, from their competitors and also from failed competitors in the space,” he said.
Yasny added that companies should also identify the “most recent development history” in the space, such as the current standard of care (SoC), and use relevant positive controls to allow investors a clear picture of how the drug stacks up against the gold standard already on the market.
Both Yasny and Coutet also recommend keeping the end in mind from the beginning, as identifying a business strategy early on can help de-risk the development process. Both investors highlighted the importance of early considerations on chemistry, manufacturing and control (CMC), regulatory, reimbursement and market access.
A biotech’s strategy should also evolve as it collects more data, while remaining reactive to changes in the competitive environment around it, Yasny explained.
While a biotech’s data stack remains one of its most important assets, Coutet and Yasny also value companies being transparent and continually engaging with it, even before seeking funding.
Coutet compared this to mission control on a spaceship, noting that relationships between a founder and a legal investor should have a similar dynamic, with “radical transparency and communication” at the forefront. “It’s really important to make clear decisions with investors, even with bad data, before it becomes a crisis,” Coutet said. By doing this, Coutet says companies can build better, more trusting relationships with the right investor, who may be able to save them in difficult times, if necessary.
In a panel discussion, Elena Beltrami, investment manager at Biotech Venture Advisors, recommended that companies focus on giving investors a realistic picture and avoid “over-promoting and under-delivering,” which can often cause problems for companies down the road.
When operating as a biotech startup, Yasny noted that companies in their infancy should always prepare for best and worst-case scenarios. This means that all companies should have a “plan B or C” if a key asset fails.
One way to achieve this, he says, is through the use of lethal experiments, which can allow companies to fail early and smartly before investing heavily in development.
This concept of adaptability also applies to the submission process, Jean-Philippe Combal, co-founder and CEO of gene therapy developer Vivet Therapeutics, said in a panel discussion. “There are two ways to submit proposals,” he said, referring to the main asset routes or platforms for companies developing ATMP. “Depending on the investor, they may prefer one or the other, so it is good to adapt the materials to the investor you are targeting,” Combal explained.
“Navigating the Valley of Death: How-to from an Investor’s Perspective” was originally created and published by Pharmaceutical Technology, a brand owned by GlobalData.
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