Country Norway
Region Norway
Investor Incitia Ventures

Drugs that target diseases such as cancer take many years – and a lot of money – to develop, test and market, but there is no guarantee of commercial success. For this reason, venture capital plays a vital role in helping European experts to develop drugs that will go on to help millions of sufferers across the globe.

So it was with Algeta, which had just finished phase I trials in 2002 when Incitia Ventures invested. At the time the company was funded by friends and family, but multiple rounds of finance have since been required to push the company through full clinical trials. Algeta is now awaiting FDA approval before launching its revolutionary treatment.

Algeta’s management needed time to fully establish “Alpha” as a major new therapeutic class and HealthCap’s long term strategic commitment enabled a steady  increase in share price culminating in a major acquisition deal.

Andrew M. Kay former CEO, Algeta

What did the business need?

  • Financing to progress through clinical trials
  • Commercial engine, including new board and senior commercial staff

How did private equity backing create lasting value?

  • Built an international calibre board, installed a highly experienced chairman and developed the commercial function with key competences unavailable in Norway
  • Put in loans during a difficult period when Algeta almost ran out of capital
  • Raised NOK185m in a process that took 18 months, despite shareholder resistance, to get Algeta through phase II trials
  • Built a broad and competent ownership structure, attracting top-tier international life science investors like HealthCap, Advent Venture Partners and GSK’s venture arm
  • Raised a further NOK250m in a flotation in 2007 following strong trial results
  • Attracted top senior management internationally

What outcomes did private equity investment achieve?

  • Took Algeta from the “friends and family” funding stage into an international pharmaceutical company
  • Algeta signed a $800m multi-year partnership agreement in 2009 with Bayer Shering Pharma, a pharmaceutical blue chip company
  • The pivotal clinical phase III trial was so successful that the study was stopped in mid-programme in 2011 and placebo patients were transferred on to the drug
  • Incitia sold 50% of its stake in July this year, realising an 8x return for investors


global agreement with Bayer Schering Pharma


equity valuation of Algeta when Incitia sold 1/2 its stake

Case study image

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