UPMC Enterprises, the innovation, venture capital and commercialization arm of the Pittsburgh-based integrated health system, said it would deploy $1 billion to develop new drugs, diagnostics and devices by 2024.
UPMC Enterprises said it would seek investments and partners that complement the scientific and commercial work already underway in Pittsburgh. The commitment includes $200 million that has funded an immunotherapy-focused partnership with the University of Pittsburgh.
UPMC has invested more than $800 million in its entrepreneurial efforts to date, primarily in digital health solutions, which have returned more than $1.5 billion.
In 2019, Tal Heppenstall, president of UPMC Enterprises, spoke with Healthcare Innovation about its investments in digital health solutions. “UPMC Enterprises is a result of us trying to stay ahead of the problems in healthcare,” he said, adding that the only investments UPMC makes are in companies that solve a problem for UPMC. “Our first investment criterion is whether UPMC is a customer. If UPMC is not a customer, it has to be one before we make a commitment to invest in a company. Also, there is a lot of value that accrues to younger companies by having UPMC as a customer. With equity investments we make, we try to capture some of that value. That is our playbook.”
UPMC has about 20 to 30 solutions per week enter its pipeline, which has a five-stage evaluation process. “If it actually does solve a problem and another vendor isn’t already doing it, we will take it in to incubate the idea,” Heppenstall said. “Then we might pilot the effort at UPMC and start a company around it or form a partnership.”
Besides its investments in digital health, the organization said its translational sciences team has grown to more than 20 investment professionals, with extensive medical, business and drug development backgrounds. Over the past two years, UPMC Enterprises has formed five companies in the translational sciences sector and invested in external biotech company Werewolf Therapeutics, as well as more than 30 research projects internally. With an initial focus on the use of immunotherapies for cancer, transplantation and diseases related to aging, the investment group has expanded its focus to include retinal and respiratory disease, autoimmune diseases, neuroinflammation and others.
“In a very short time, UPMC Enterprises has backed a promising pipeline of companies and research that could radically change the way we treat some of the world’s most devastating diseases,” said Steven Shapiro, M.D., chief medical and scientific officer at UPMC, in a statement “Our scientists at Pitt — along with others globally who will enrich their efforts — are seeing the results of their research moved out of the lab and into the commercial realm at a speed and cost that previously wasn’t possible in the academic environment. That’s good news for our patients and millions of others worldwide who will one day benefit from these treatments.”
