In an announcement last Monday, GlaxoSmithKline had confirmed a deal with venture capitalist firm Avalon Ventures that is worth nearly US$495 million for the funding of as many as ten drug-discovery start up companies for the next three years.
Under the deal, GSK would be providing the financial and technical support to the start up firms that would be established by Avalon Ventures. GSK would then have the first rights for the purchase of each new company.
As for Avalon, it would be contributing nearly US$30 million for the partnership. GSK for its part would be shouldering the US$465 million in funding and developmental milestone payments, according to GSK spokeswpman, Melinda Stubbee.
The normal process would be large pharmaceutical firms would provide early stage venture investments as a proxy for much more expensive internal research and development for drug development.
Stubbee further added that each of the start up firms would have a few employees and would focus on singular compounds in the development of therapies for conditions from infectious diseases to cancer.
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