Good day. Well-funded health-technology companies are using the sluggish market for mergers and acquisitions as an opportunity to scoop up rivals.

The healthtech market is recalibrating from the investment surge of 2021 in which valuations outpaced many companies’ progress. That has slowed the pace of M&A as buyers and sellers wrestle over terms.

Last year, 53 venture-backed healthtech startups globally were acquired, the lowest number since 2020, according to PitchBook Data.

Some venture-backed companies are using this to their advantage. Late last year, for example, LetsGetChecked, a provider of tools to manage health at home, acquired digital pharmacy Truepill. 

More healthtech companies will consider mergers with competitors, said Aaron DeGagne, senior analyst, healthcare, with PitchBook.

“There is likely going to be a rise in M&A consolidation as companies position themselves for a potential listing or to gain scale and profits faster,” he said.

And now on to the news...

Venture fundraising. Venture firm Andreessen Horowitz is planning to raise $750 million for its next fund to back life-science and healthcare startups, according to people familiar with the situation, WSJ Pro’s Yuliya Chernova reports. This would be half the amount it collected for this strategy in 2022, suggesting a recalibration amid a stagnant venture fundraising market. 

• The firm registered the new fund called AH Bio Fund V in Delaware in late January, according to information from the state. Representatives of the firm didn’t respond to a request for comment.
   
• Vijay Pande is a general partner at Andreessen Horowitz who founded and leads its bio strategy. That strategy backs private companies from seed stage through initial public offering in life sciences, care delivery and other categories.

Venture capitalists are looking to artificial intelligence to sling healthtech startups to a faster pace of growth and hopefully lift the industry out of its trough. Healthtech venture funding, along with acquisitions and initial public offerings, soared in the pandemic, lofting many startups to fizzy valuations. Since the market’s turn, though, some of these companies have struggled to go public or be acquired without accepting lower prices. But recent advances in AI are enabling startups to grow faster and tap a giant opportunity to improve efficiency in healthcare, investors said.

Dairy farmers across the country are turning to internet-connected “smart” collars, ear and leg tags to track the specific movements and patterns of their cows, WSJ reports. The goal is to better manage individual animals in a herd without needing as much manual labor. That’s especially important as the country’s demand for dairy has increased, but the number of farms has decreased. The tech can also help detect irregular patterns that could indicate disease like the H5N1 avian influenza, which has decimated millions of America’s chickens over the past few years and spread into the nation’s cows.

Funds

European life sciences investor Sofinnova Partners held the final close of its Sofinnova Biovelocita II fund with €165 million in commitments.

SemperVirens Venture Capital, which invests in startups driving workforce transformation in the enterprise, healthcare and financial services sectors, raised $141 million for its third core fund and $36 million for its second growth opportunity fund.

T45 Labs, which is focused on accelerating the development of breakthrough cardiovascular technologies, closed its $25 million T45 Fund I.

People

Culina Health, a digital platform for clinical nutrition care, appointed Jane Mentz as chief operating officer. She previously held positions at Calibrate and Quartet. 

Auron Therapeutics, a startup dedicated to improving patient outcomes in oncology and inflammatory disease, appointed Glenn Goddard as chief financial officer. He previously served as executive vice president, CFO at Intellia Therapeutics.

Medical diagnostics provider Cytovale named Rhonda Collins as the company’s first chief nursing officer. She was previously CNO at Kontakt.io.

Latigo Biotherapeutics, a Thousand Oaks, Calif.-based developer of non-opioid pain treatments, closed on $150 million in Series B financing. Funds managed by Blue Owl Capital led the round, which included participation from Foresite Capital and several others. Kevin Raidy, senior managing director at Blue Owl Capital, joined the company’s board.

Curevo Vaccine, a Bothell, Wash.-based startup developing a vaccine for shingles, completed a $110 million Series B round. Medicxi led the investment, which included participation from OrbiMed and others. Giovanni Mariggi, co-founder and partner at Medicxi, will join Curevo’s board. Moncef Slaoui was appointed board chair.

Maxion Therapeutics, a U.K.-based startup developing antibody-based drugs for autoimmune conditions, chronic pain and cardiovascular disease, raised $72 million in Series A financing. General Catalyst led the round, with Managing Director Elena Viboch joining the board.

Ampersand Biomedicines, a Boston-based startup developing medicines that act specifically at the site of disease, secured $65 million in Series B funding from investors including Flagship Pioneering and Eli Lilly & Co.

Proscia, a Philadelphia-headquartered software company helping pathology’s transition to digital and AI, landed $50 million in funding led by Insight Partners.

Perfuze, an Ireland-based stroke treatment developer, picked up a €22 million follow-on funding round from investors including Earlybird, EQT Life Sciences, Seroba and SV Health Investors.

Olio Labs, a San Francisco-based AI-driven therapeutic design startup, emerged from stealth with $4.5 million in seed funding led by Boom Capital and Overwater Ventures.

• Sale of Ozempic knockoffs is supposed to end soon. Telehealth companies aren’t happy.

• Trump administration weighing major cuts to funding for domestic HIV prevention

• Purdue Pharma has a new plan to settle mass opioid lawsuits. Here’s what happens next.

• Medalogix, Forcura merge to form a $1 billion healthcare software business

• Measles cases are climbing; who needs another shot?

• We are turning too many people into medical patients

• Leading a movement away from psychiatric medication (New York Times)
   
• Immunovant claims study success for immune disease drug but holds off on submission (BioPharma Dive)
   
• Unleased lab space. Plunging valuations. Layoffs. In Massachusetts, the biotech slump is taking its toll. (Boston Globe)
   
• Stem cell company bit.bio cuts quarter of staff, drops therapeutics focus (Endpoints News)

This newsletter was compiled by Brian Gormley, Matthew Strozier and Zachary Cole.

WSJ Pro Venture Capital is a premium service of The Wall Street Journal. We cover venture capital and the global startup ecosystem. Share your tips, comments and questions: vcnews@wsj.com

The Team: Matthew Strozier, Yuliya Chernova, Brian Gormley, Angus Loten and Marc Vartabedian.

Follow us on Twitter: @wsjvc