Aisling Capital Makes Big Money Off Loxo Sale

Aisling Capital scored a venture capital home run earlier this year when their biotech business Loxo Oncology was recently scooped up by pharma giant Eli Lilly & Co. for $8 billion. It means big money for the firm as their share of the cancer-fighting company will yield about $470 million in earnings.

Founded in 2000, venture capital firm Aisling invests in both public and private equity but prefers life science companies that are in the clinical stage of development. Steve Elms and Drew Schiff are the firm’s managing partners ad believe their combined experiences – Elm’s financial background as a banker Schiff’s clinical background as a physician – means they help guide their portfolio company through the entire process of bringing a drug to market.

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“From our perspective, there’s nothing more satisfying than seeing a drug achieve approval, be marketed and change the way patients are treated,” Schiff said in an interview. Loxo Oncology is one such success story with humble Aisling beginnings. The venture capital firm partnered with Loxo’s founder, Josh Bilenkar, in 2013 and became both the initial investor and office space lender to the fledgling biotech business. Fast forward six years and there is no doubt that the prospect has paid itself off.

Elms points out the company is on the lookout for other oncology investment options. They are intrigued by the potential in personalized vaccines that can help curb cancer growth. He also says Aisling is interested in immune-oncology approaches that target specific protein fragments – like neoantigens.

“With targeted medicine, you know really quickly, and can stop the program right away” if the drug isn’t successful or has serious side effects, Elms said. Unlike in immune-oncology, “you don’t have to worry about multiple clinical trials with multiple combinations” and then wait for them to work.

In additional to their capital contributions, Aisling takes an active role with their portfolio companies and offers strategic assistance to foster their success. “We [are] really involved in those companies,” Elms said. “I’m very involved in their financing strategy, as well as product development strategy.”

Some of the firm’s more recent investments include participation in an $85 million funding round for Ajax Health led by HealthQuest Capital. Along with other firms, Aisling also partnered with Novartis Pharma AG to raise $142 million in series C funding for Poseida Therapies.

Since their beginning, Aisling has raised over $1.8 billion in committed capital spanning four funds. In total, they have made 106 investments in companies at various the development stages and wide array of capital structures. In terms of life science specializations, Schiff and Elms are interested in exploring options. They do not specialize in one specific area when it comes to the life sciences, they look for companies that occupy the biopharma, consumer, diagnostics, medical devices and services subsectors.