NeXeption, Not The Rule: Another Twist On Asset-Based Financing

Article preview from Start-Up - November, 2012

As VCs experiment with new models for single-asset companies, new entrant NeXeption is trying something similar without raising its own fund. Can it wring enough value from the best assets pharmas are neglecting, without giving too much back to their original owners?

 NeXeption, Not The Rule: Another Twist On Asset-Based Financing

Article preview from Start-Up - November, 2012

Venture firms that have begun experimenting with asset-based financing hope to reap returns from relatively quick, clean exits, some in the next year or two. But as many await the first outcomes of their strategies, which typically involve isolating assets in single-program virtual companies operated by an external entity, some find themselves in complex deals tied to options and other obligations, suggesting that the new models are anything but simple.

Moreover, good licensing targets remain scarce, with pharmas reluctant to hand them over to start-ups for development unless they retain an interest in their success. As a result, some firms that do asset-based investing are beginning to make adjustments, while others have soured on the model completely.

Into this shifting landscape steps NeXeption LLC, which isn’t a venture firm at all. Rather, NeXeption calls itself a “biopharmaceutical management company,” one that wants to unite assets, management teams, and funding in new companies streamlined for single-asset development and quick sale as proof-of-concept is reached.

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No publication reviews leading edge companies and technology better than Start-Up. Each issue of Start-Up profiles the most important new product companies, identifies the hottest technology areas, reviews funds flowing into private companies and investment trends, and reports on university tech transfer licensing. Industries covered: pharmaceuticals, biotechnology, medical equipment & devices, and in vitro diagnostics.

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