Investing in Life Sciences

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1:48With our unified Team Michigan approach, businesses scale faster and compete at the highest level. Michigan, pure opportunity. Seize your opportunity at michiganbusiness.org. Bloomberg Audio Studios, podcasts, radio, news. You're listening to Bloomberg Business Week with Carol Masser and Tim Stenevek on Bloomberg Radio. What's the matter? You're thinking a lot about biotech. I love the biotech sector. I think, I still think that there's so much we have yet to learn about the body and how things work um yeah and i think with ai there is this potential i just i just want cancer to be cured i just want cancer truly i know i know i feel like it's the the next big thing we've figured out a lot of things what there's idea of cancer moonshots and it's just i don't know it's just like it's very frustrating yeah i know i know i know so we talk about it a lot we do there's a lot of money going though at the world of pharmaceuticals and and biotech and and one One story we wanted to point out, or Jerry Smith wrote this of Bloomberg, that Blackstone is investing$250 million in a biotech startup.

2:59It's Anagram Therapeutics. It's part of the private equity giant strategy to own more cutting-edge drug makers. I mean, it's called Blackstone Life Sciences. They have some$17 billion in AUM, typically investing in late-stage medicines invented by biotech and pharma companies in exchange for royalty and future sales. That gets into the model. I think what's interesting to me is their latest Life Sciences Fund has$6.3 billion of commitments. It's the firm's biggest haul for backing clinical trials of medicines and technologies. I like to see where the money flows. I also think money can help make things happen and hopefully have a cure for cancer.

3:35We put it in one bucket, but there's hopefully lots of cures. Yeah, these are things that Jenny Rook thinks a lot about because this is an area that she invests in. She's the founder and managing director of Genoa Ventures. She's back here in our Bloomberg Interactive Brokers studio. Your portfolio has investments in new culture, Redux Bio, Fellow, Bond Pet Foods, and more. Good to have you back with us. It's been, gosh, since January when we last spoke. How are you? I'm doing well. How are you? Nothing's happened, right? It's been pretty chill so far. Yeah. Last year. Well, what's the connection between the public markets and sort of what you see in your world of venture capital and VC investing?

4:16Is there any connection to volatility that we saw in March, an increase in positive sentiment we saw in April? Does that affect your world at all? It does. And maybe even more than I probably originally realized getting into venture. But it's exactly as you were just saying, Carol, is that when you have in the public markets the interest, the capital, the emphasis on driving these later stage businesses forward, getting medicines out through the clinic and into the market, that drives a lot of the underlying layer of demand for tools, the application of AI to the discovery of biology, making you less frustrated about what we don't know in medicine.

4:56So it really is driving, I think, both the right attention and the right investment. Jenny, when there's a big player like Blackstone, is that good for the market? Is it more competitive than for you? These are late stage. I think you're earlier, right? That's right. So at Genoa Ventures, we exist to lead first rounds in companies that are hopefully going to be public in seven to ten years being part of the venture asset class. But it's very important to have these later stage funds validating that the segment itself is an important place to put capital and is driving returns later as well. So let's get to curing cancer.

5:30Okay. Please. Why is it so difficult? And our company is still working on this, given that we've seen we've talked about this with you in the past. I mean, you know, in the past 18 months or so about research funding drying up at some universities. But are companies still putting money? Oh, very much. So I would say if you look at the therapeutic space generally and where investment is going, that is still the oncology is still one of the leading segments for investment and innovation. If you, yes, there's work still to be done, but it is no longer a death sentence today. It's not. But one scary thing about the reason why I think so much money is going into oncology is because it's becoming increasingly common for people as they live longer.

6:16That's right. So more people are getting it because more people are living longer. And also there are other types of cancers that younger people are now getting. Right. Like colorectal cancers. Exactly. That's exactly right. So in a sense, it is the flip side of the coin of living longer, healthier lives. Some have called cancer a disease of aging. So we are now living long enough to encounter it. It's also very complex. It's not one thing. It's not even just one thing in a given organ. It's many different kinds of molecular changes. So talk to us about what's interesting that's going on in terms of biology.

6:48What are you seeing? Right. Well, something that's been really exciting in this past quarters, we've started to see the public markets opening up. We've had a couple of IPOs in the biotech space. Surprising and delightful to us as investors in the infrastructure and the tool chain. One of those was not therapeutics at all, but a proteomics company. So Alamar Bio came out on NASDAQ, oversubscribed, has traded up since then in the months since then. And what they do is they make it possible to measure more proteins in, for example, a patient sample at a greater level of precision and sensitivity than ever possible.

7:24And the hunger for being able to measure what's happening in the protein layer, which is in some sense the business end of biology, is necessary for the next phase of understanding cancer biology, diagnostics, and even kind of engineering of drugs in all of those spaces. Why is that? Yeah. Like understanding that layer. Now, I think you probably know, you've probably heard the dogma, as I say, genes, DNA, make RNA, make proteins. And it's proteins that circulate, interact with each other. It's kind of the network of what's happening in the body and between cells. And it's often proteins, something going on with the proteins that goes wrong when we're talking about disease pathology.

8:02And so we need to be able to measure that. Got it. And, you know, we've made bets in that space, too. I think before we got going, I still feel like we still don't know so much about the body. and what the body can be used. I think we're learning more with immunotherapy, right? Correct. How to use the body to help cure what ails us. That's right. But all of this depends on, and actually the AI revolution is fueling hunger for more and better data. Yeah. You probably know that AI is only as powerful as the quality and the amount of data that you put into it. Right. And so we've known, as you say, Carol, there's so much we still don't know.

8:37But now there's reasons to get that complexity of DNA because we can interact with it with AI tools. To your point, Carol, I think what surprises me so much in talking with friends who are doctors is how much out there is idiopathic. It's the idea that, okay, we recognize that the symptoms exist. We see your symptoms. We just have no idea what causes them. Like that's, in 2026, with imaging, with blood testing, with all of the diagnostic testing that we have, there are still so many more questions. So how do we get to those really great data sets? because, I mean, are health facilities competing for the data because that gives them more value?

9:12Or is there going to be some comprehensive data set so that we all benefit off of it? I think what we've seen so far with AI generally, this is outside of healthcare, but AI is most powerful when one can close the loop between generation of exactly the right data set at a high quality to answer the question you want to answer. So in the healthcare space, closing the loop between turning biology into data, feeding that into better and better AI models, generating insights, and then doing it again. And so that pace of learning with the AI support is only accelerating. Have we seen any of that proven out yet?

9:48Yeah, I think you see it in one of the other kind of big news in the space is Roche's acquisition of Path AI, right? And I think for people who are interested in the space and trying to understand how AI is affecting healthcare, that's a pretty great one-stop example or case study because path AI solutions include generation of data on samples, visualization, like you were saying, and then the AI tools to understand it, as well as workflow improvements because what matters is can you deliver it to patients in the healthcare system. But you know what? Going back to the data, who is going to be the accumulator?

10:24I do. We've had a guest on, somebody I talked to at Bloomberg Invest, about this whole idea of agentic AI, but talking about data sets that are very specific to a different industry. And her point really was that, you know, you're not going to need all these LLMs accumulating everything. You're going to need these very narrow. Very focused. Right? So who, like, let's take, I don't know, colon cancer. Like, will there be an accumulator taking in data from global so that you really get a great data set? Or does everybody have their own? The answer ends up being both. So you end up with large comprehensive data sets.

11:07For example, like the UK Biobank is a very rich data set with a lot of longitudinal information about patients and their health care. And then the ability to access that and add to it the layers of specific data sets that, for example, a company trying to develop a diagnostic in a particular cancer might add a proteomics layer or a glycoproteomics layer around a particular test. Is the U.S. still accumulating great data with this administration and some of the cuts and so on and so forth? Are we still accumulating smart data? We are. This is a really important question. A lot of the conversation this year that I've been in has been, what is our relative investment in generating more data at high quality?

11:48And how does that compare to other geographies like China? We have to talk about China. I want to go in a different direction than China. but because we have to talk about China another time. Are incentives aligned for, in our healthcare system to make people healthier? It's honestly easier to talk about China than our healthcare system, but okay. Because our healthcare system makes money when people are sick. Yeah. If you think about some of the biggest hospitals, insurance and insurance companies, some people argue insurance companies serve as a check on some, some, some healthcare facilities because they're only going to pay for X.

12:28So, and you know, they kick you out after a certain number of days. Are the incentives misaligned in our society? And you're quite right to talk about the incentives and, and you know, this is well above my pay grade as a venture investor. So that must cross your mind when you're doing the calculus and when you have the spreadsheet out. So you have to think about is a solution that is based on innovation and coming to market in a way that can at least align enough of the incentives to get there to be used yeah that's the question okay next time china next time china no i really do want to talk because uh we were talking about china with solar or like i mean yeah i have to well yeah and we have to also talk about how that intersects with biotechnology beyond health care as a technology layer or general purpose technology for security for defense for agriculture and food for industrials you were talking earlier about critical minerals yeah It's a space where we're looking where bio can have an impact as well.

13:19See, you always leave us wanting more, Jenny Rook. My pleasure. Be well, be well. Have a good weekend. Thanks for swinging by. Jenny Rook, she's founder and managing director of Genoa Ventures.

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