Barbara Schilberg, BioAdvance, on funding early-stage life sciences ventures, young entrepreneurship, women in innovation, and healthcare investment trends.
In this episode of “Spotlight on Women in Health Ventures,” we interview Barbara Schilberg, the CEO of BioAdvance, a lawyer and investor in early-stage life sciences companies and technologies in the mid-Atlantic region, who championed the growth of the evergreen fund from $20M to $75M. At the time this article was written, BioAdvance has 30 active portfolio companies, and 11 products with FDA approval. In her 30 years of working with academic technologies and startup companies, she has also served in the boards of four different emerging life science companies, where she coordinated clinical trials, FDA drug approval processes, and business activities day to day.
3 characteristics of successful entrepreneurs
During our interview with Barbara, we could not help but ask: What does it take to become the next startup BioAdvance invests in? How does BioAdvance decide which company seems most promising?
“You might see 50 things and not like any of them. BioAdvance invests in less than 5% of the companies that they see. You know it when you see it. If it doesn’t feel good, don’t do it. You have to feel it in your gut and brain,” Barbara reflects.
She shared that she pays attention to the entrepreneur behind the venture just as much as she looks at the intricate details of the company’s solution.
A few qualities she believes make successful entrepreneurs:
- Coachability — the team needs to be willing to listen. Barbara has worked with CEOs with no prior experience, but whose eagerness to learn made them successful leaders. She also appreciates it when entrepreneurs have already thought about some the issues that BioAdvance raises and has some responses.
- Cautious Optimism — Barbara has seen people who are so passionate that they drink their own KoolAid and they fail to recognize that there are weaknesses in the product. You really don’t want to be close-minded and not recognize your limitations.
“A really good entrepreneur is one that is a champion and is passionate, but has also thought about what the weaknesses are and knows how they will handle them and deal with them.
3. Perseverance During Adversity — Another key consideration is how resilient is the entrepreneur. Do they throw up their hands and give up in the face of adversity? Barbara shares that now with the pandemic — the digital health entrepreneurs are really having trouble since hospitals have closed their doors. The best ones have been pivoting, and making lemonade out of lemons. How entrepreneurs respond during adversity is very telling of their business’ probability to succeed.
On the note of perseverance, Barbara describes her own career path as a game of shoots and ladders. Time and time again, she has had to learn along the way. In retrospect, she realizes that being surrounded by driven colleagues who complement her skills has been fundamental when navigating challenges.
Embrace opportunities even if it requires learning along the way
Barbara started her career as a lawyer. One might wonder how did a lawyer dive into the biotech world? Barbara’s trajectory challenges the notion that the healthcare sector is exclusive to scientists and physicians.
“I love science, even though I am not a scientist by training. I am not afraid of it, and because of that, I have been able to learn it along the way. People are often surprised that I don’t have a science background because I am very conversant about the technology and biological mechanisms.”
As a partner at international law firm Morgan Lewis, Barbara’s skills and knowledge in licensing and protecting new discoveries opened a door for her at Wistar Institute, a cancer research institute in Philadelphia. Soon after, Barbara was helping researchers at University of Pennsylvania, Thomas Jefferson University, and Wistar build businesses around their newly developed therapies, and represented these companies when they became public.
Later, when a former boss approached her with the possibility of starting a greenhouse for early stage life sciences companies, she had incredible experience under her belt serving as a board member to four different emerging life sciences ventures. Yet, she had never considered becoming an investor nor had any investment know-how.
As a lifelong learner, Barbara was not intimidated by the enigmatic realm of venture capital. Finding herself having to learn along the way again, she realized her legal background was an useful asset:
“My training as a lawyer is interesting because it makes me very objective. I even challenge the scientific assumptions and I can sense when someone is taking a leap that really isn’t founded. So even though I didn’t plan on being an investor, my law background really helped me become one,” she reflects.
One can tell that embracing all opportunities is a motif in Barbara’s trajectory. Unsurprisingly, she took on this new adventure, and BioAdvance was built with funding from a big tobacco settlement that states had joined in 2001. Starting with $20 million from the state of Pennsylvania, as the CEO, she had to ensure this money would suffice in developing a sustainable business in the long-term.
“It was slightly crazy to think that was even doable, but we did it.”
BioAdvance’s differentiation and big deals: BioAdvance’s evergreen nature allows them to stay with a company for a very long time, as they recycle their returns. Over the years, Barbara has found motivation in seeing companies evolve and shared two examples that, for her, epitomize the fulfillment that comes from witnessing companies’ and entrepreneurs’ transformations.
- Novira Therapeutics — This early stage company approached anti-viral treatments in a way that had never been done before, and were focusing on Hepatitis B, while most pharmaceuticals channeled their energies into Hepatitis C. BioAdvance saw promise in this bold stance, and invested $1.5 million in this company, while incubating it for three and a half years. They scraped by initially, and then raised a Series A round from Canaan and Versant. Novira was ultimately acquired by J & J, and are in the midst of Phase 2 trials for their Hepatitis B drug candidate (NVR 3–778). One of the co-founders, Lalo Flores, went on to start Century Therapeutics, which just raised $250M for its approach to cell-based therapy.
- Relmada Therapeutics — Sixteen years ago BioAdvance invested in Relmada that focused research to bettering the lives of patients suffering from diseases of the central nervous system. Even though the company went through many pivots including a change in management, BioAdvance continued to support their vision. Ultimately, Relmada went public in December of 2019, and now, they have just published their Phase 2 results and the stock price went from $4 to $42! BioAdvance was patient with Relmada and it came out in their favor. With its multiple product candidates (NMDA antagonists), Relmada is taking on major depressive disorder, a debilitating disease that disrupts the lives of so many people.
“It was domain expertise that made us choose to invest in both Relmada and Novira. These concepts were executed beautifully with little money. The respective teams inspired confidence in us.”
BioAdvance has also funded multiple student ventures at this point, particularly in digital health. In fact, they funded Ride Health and Group K Diagnostics, both of which have been featured in Theia’s podcasts and whose stories have been shared here.
Advice to You, Entrepreneur
If you are thinking about starting your own company, here are some insights from Barbara you do not want to overlook!
When to start: There is no one size fits all in the entrepreneurial journey, but Barbara advises being strategic about when to start your venture.
“You can’t really start a life sciences company when you are at the prime of your life, with four kids and student loans. So, either do it before you get loaded or after you make some money.”
“Entrepreneurial time is the most scarce resource, and there is not enough of it to go around.”
What’s hot and what’s not: Barbara sees great excitement surrounding platform companies and digital health — in fact, she argues it is a promising space for young entrepreneurs to explore. Most of the student ventures funded by BioAdvance are digital health solutions. She adds that rare diseases and gene therapy are on the rise, but immunotherapy is approaching saturation.
Addressing healthcare disparities:
“It is a fiduciary duty of the healthcare industry to consciously address healthcare disparities in their own micro way. This will take a combination of little efforts that will ultimately become one large effort and impact our patients.”
Barbara argues that the healthcare industry is in a unique position to address both economic and healthcare inequities to best serve patients. She would love to see companies articulating ways to conduct clinical trials or build software in a way that increases the quality of care for underserved communities.
For example — if you are looking at biomarkers — “what patient population are they from? We all need to start being aware and recognize when we aren’t being inclusive.”
Barbara further questions who might be able to take the lead on addressing healthcare disparities in our complex world.
“The younger generation is most qualified to address healthcare disparities through ventures because they are less tolerant of bias and prejudice.”
Women in the startup world: Barbara did not miss the opportunity to highlight that women-led companies make more money and generate higher returns, compared to companies led entirely by men, as indicated by a recent Kauffman Foundation study. She attributes this relative success to meticulous planning: “women don’t just wing things — they have Plans A, B, and C.” They often have pondered what could go wrong and how they can intervene to amend chaotic situations. In her experience, Barbara has observed that besides planning for adversity, women also present their story in a more cohesive way.
Barbara shares that 15% of BioAdvance’s portfolio companies are founded or led by women. Even though this proportion is superior to the national average, Barbara is passionate about increasing female representation in the fund’s portfolio and in the startup world more broadly.
Final thoughts
Barbara’s reflections are invaluable for all current and future entrepreneurs — at the end of the day, her career is about talking to founders, and exploring what makes life science companies successful.
Barbara’s wisdom might have been the last push you needed to jump off your chair and start turning your ideas into action. But before you run, take a look at this checklist Barbara shared:
- Find a problem that you care about solving.
- Do some diligence.
- Spend some time talking to people about your idea — does it make sense?
- Find a partner/ co-founder.
- If all of those things check off, go for it.
“Starting a venture is probably the most exhilarating experience that you can have.”
Theia is a 501(c)(3) non-profit dedicated to inspiring and empowering the next generation of women entrepreneurs and investors in healthcare. Visit our website to join our community and access resources that will support your entrepreneurial journey and pursuit of changing healthcare.
Story written by Luiza Perez and Priya Kumar.
