21 December 2021: Medical innovation has become a significant focus for venture capital investment in the last ten years. A growing, ageing population combined with the opportunity to develop global solutions is driving a spike in innovation that helps people better manage their wellbeing or enables them to get well sooner.
Traditional pharmaceutical innovation is now being supplemented with developments in medical technology. The medical device industry is predicted to be worth more than $8.5 billion by 2025 but ensuring the industry’s success will be underpinned by investment from venture capital firms and other investment vehicles.
A company well established within the world of technology private equity investment is Juno Capital. One of its partners and co-founder, Edward Rudd, outlines his experience of investing in medical technology (MedTech) companies, the advantages of platform technologies for an investor and the importance of data analytics in driving positive outcomes in healthcare.
Established in 2011, Juno Capital is an innovative asset management company that provides wealthy individuals and families with attractive and engaging investment opportunities offering a variety of risk profiles. One of the company’s primary objectives is to introduce private investors to early-stage technology companies, helping them decide whether to participate in investment rounds in these companies and offering the opportunity to build diverse and engaging portfolio of investments.
Investment criteria
One of the most important criteria for investment is that companies have already established themselves within a specific market through their technology, product or service, but need additional capital to accelerate growth and build on their achievements. One such company was Sky Medical Technology, which has taken a technology called ‘On Pulse’ and turned it into a wearable medical device that addresses medical issues.
I was first introduced to Sky Medical Technology when I was a partner at my previous investment company, Longbow Capital LLP, a specialist healthcare investment firm where I was responsible for sourcing and researching new opportunities.
I led the deal for Longbow to invest in Sky Medical Technology during 2009. When I and fellow founding partner Julian Hickman left Longbow to set up Juno Capital, we decided to remain in company with Sky Medical Technology. It was one of the companies that I was keen to continue to have a relationship with. And now, I believe that we have invested more in Sky since we’ve left Longbow than we did when we were there.
One of the first challenges for Sky was to take an established and proven technology and make it into a product. The result – the geko™ device – a wearable medical gadget that helps address multiple medical disorders. The device, applied at the knee, works by sending electrical pulses to the lower leg that increase blood circulation. It is an easily understood, yet proprietary, mechanism of action, well protected by a family of patents, that can be applied to separate therapy areas – meaning each therapy area simply needs study data and positive economic data to be embedded into clinical practice.
It was a simple product. I have previously invested in medical heart pumps and these are incredibly complex devices. I liked the idea that, with the geko™ device, you’re leveraging the body’s own healing mechanisms. You’re basically giving the body the means to heal itself.
A platform technology [next page]
