Michigan is now the No. 3 state in the Midwest for health care venture funding, and the Detroit-Ann Arbor area is the No. 2 metro.
That's the word from the latest Midwest Health Care Venture Investment Report from Cleveland-based BioEnterprise.
Overall, Midwest health care startups reported $593 million in total investments across 140 companies through the first three quarters of 2009, according to the BioEnterprise Midwest Health Care Venture Investment Report.
This year's funding is lower than the prior two years -- $896 million in 2008 and an even $1 billion in 2007 -- in similar proportions to national venture industry reductions for health care investments.
However, surprisingly, the number of companies receiving investment is greater than the prior two years and is on pace to set a new record for Midwest health care venture transactions.
The number of companies funded was 139 this year, up from 113 in 2008 and 104 in 2007.
"Funding for health care is reduced due to the recession and concerns surrounding the impact of health care reform on innovation," said Baiju R. Shah, president & CEO of BioEnterprise. "Given the broader environment, it is encouraging to see so many Midwest health care companies attracting capital."
Ohio and Minnesota lead the way in dollars of financings with companies in those states attracting $137 million and $134 million respectively.
Michigan attracted $88.7 million to 11 companies, down less than 2 percent from $90 million to 10 companies a year earlier.
Among metro areas, Detroit-Ann Arbor was No. 2, with $70.8 million attracted, behind only Minneapolis, which attracted $133.3 million, and ahead of Cleveland ($55.7 million), Chicago ($38.8 million), Indianapolis ($39.2 million), Columbus ($11.7 million) and Pittsburgh ($28.9 million).
Overall, by sector, the equity funding was as follows:
Biopharmaceutical companies: $295 million
Medical device companies: $173 million
Health care software and service companies: $125 million
The Midwest Health Care Venture Investment Report includes all reported numbers and regionally collected data. For complete state and region results across the Midwest, see the attached table.
To view additional data about Midwest health care business activity visit http://www.bioenterprise.com/Reports/.
BioEnterprise is a business formation, recruitment, and acceleration effort designed to support the growth of bioscience companies. BioEnterprise provides management counsel and support services to health care companies. BioEnterprise partners are Case Western Reserve University, Cleveland Clinic, University Hospitals, Summa Health System, and the Austen BioInnovation Institute in Akron. Additional technology partners include the NASA Glenn Research Center, Cleveland State University, NorTech, and BioOhio.
More at www.bioenterprise.com.
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